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NOT  TO  BE  TAKEN  FROM  ROOM. 

This  book  is  the  property  of  the  Theo- 
sophical  Society  in  America,  for  use  at  its 
Headquarters,  14.4.  Madison  avenue,  for 
reference  only. 

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330-9 


THEOf 


SELECTIONS 


ILLUSTRATING 


ECONOMIC    HISTORY 


SINCE    THE    SEVEN    YEARS'    WAR. 


COMPILED     BY 

BENJAMIN   RAND,  PH.D. 


BOSTON : 
A.     A.     WATERMAN     &     CO., 

36   BROMFIELD    STREET. 
1889. 


TV.  1 5" 


Copyright,  iSSS, 
BENJAMIN    RAND. 


PBBSS  OF 

ttochtocll    &   vTliurrt)  ill, 

No.  39  Arch  Street, 

BOSTON. 


PREFATORY   NOTE. 


THESE  selections  have  been  made  for  use  as  a  text-book  of 
required  reading  to  accompany  a  course  of  lectures  on  eco- 
nomic history  given  at  Harvard  College.  The  work  was  un- 
dertaken at  the  request  of  Professor  Charles  F.  Dunbar,  to 
whose  kind  counsel  the  compiler  has  been  throughout  greatly 
indebted. 

This  book  has  already  been  adopted  for  a  similar  purpose 
as  at  Harvard  by  other  leading  American  Universities. 
Although  the  compilation  was  prepared  with  special  refer- 
ence to  the  needs  of  students  in  courses  of  economic  study, 
yet  the  nature  and  scope  of  the  selections  render  them  of 
value  to  any  person  who  may  desire  to  obtain  a  knowledge 
of  some  of  the  most  important  events  and  influences  in 
modern  economic  history.  B.  R. 

CAMBRIDGE,  May,  1888. 


2003185 


CONTENTS. 


PAGE 

LEADING  SECTIONS  FROM  THE  ENGLISH  NAVIGATION 

ACTS  . i 

From  English  Statutes  at  Large. 
II. 

THE  COLONIAL  POLICY  OF  EUROPE    ....      5 

From  Adam  Smith's  Wealth  of  Nations. 
III. 

THE  GREAT  INVENTIONS 31 

From  Walpole's  History  of  England. 

IV. 
ECONOMIC  CAUSES  OF  THE  FRENCH  REVOLUTION      .     52 

From  Von  SybeFs  French  Revolution. 

V. 
THE  EMANCIPATING  EDICT  OF  STEIN          .        .        •    7$ 

From  Seeley's  Life  and  Times  of  Stein. 

VI. 
THE  ORDERS  IN  COUNCIL  ...  97 

Frcm  Levi's  History  of  British  Commerce. 


VI  CONTENTS. 


VII.  PAGE 

THE  FINANCES  OF  ENGLAND,  1793-1815    .        .        .in 

From  Porter's  Progress  of  the  Nation. 

.. 

VIII. 

THE  ZOLLVEREIN         .        .        ;:      ;        .        .        .130 

From  Bowring's  Report  on  the  Prussian  Commercial  Union, 
Pad.  Doc.,  1840. 

LE  ZOLLVEREIN  .        . 153 

From  Legoyt's  La  France  et  PEtranger. 

•-^ 

IX. 

THE  CORN  LAWS         .        .        .  ,      .        .        .        .163 

From  Levi's  History  of  British  Commerce. 

X. 

THE  NEW  GOLD          .        .        .        .        .        .   ;     .  189 

From  Cairnes1  Essays  in  Political  Economy. 

XI. 
FRANCE  sous  LE  SECOND  EMPIRE      .        .        .        .  225 

From  Levasseur's  Histoire  des  Classes  Ouvrieres. 

XII. 

THE  FRENCH  INDEMNITY  :  — 
THE  PAYMENT  OF  THE  FIVE  MILLIARDS         .        .  237 

From  Blackwood's  Edinburgh  Magazine. 

THE  APPLICATION  OF  THE  INDEMNITY    .        .        .259 

From  Kolb's  The  Condition  of  Nations  (Trans.). 


CONTENTS.  VII 


XIII. 


PAGE 


THE  RECENT  PROGRESS  OF  ITALY       .  .'•     .        .        .  263 

From  Wilson's  The  Resources  of  Modern  Countries. 

i 

XIV. 

THE  UNITED  STATES  IN  1880:- 
THE    INCREASE    OF    POPULATION    FROM    1790   TO 

1880         .        ...        .        .        .        .        .-286 

From  Walker  and  Gannett's  Report  on  the  Progress  of  the 
Nation,  Tenth  Census. 

THE  FACTORY  SYSTEM     .        .        .        .        .        .308 

From  Wright's  Report  on  the  Factory  System  of  the  United 
States,  Tenth  Census. 

THE  COTTON  MANUFACTURES  .        .        .        .        .317 

From  Atkinson's  Report  on  the  Cotton  Manufactures,  Tenth 
Census. 

THE  IRON  AND  STEEL  INDUSTRIES  .        .        .        -339 

From  Swank's  Statistics  of  the  Iron  and  Steel  Production, 
Tenth  Census. 

XV. 
LES  DETTES  PUBLIQUES       .        .        .        .  .352 

From  Neymarck's  Les  Dettes  Publiques  Europeennes. 


SELECTIONS. 


LEADING   SECTIONS   FROM  THE   ENGLISH   NAVIGATION 

ACTS. 

ACT  OF  1660,  12  CAR.  II.,  c.  18. 

An  Act  for  the  Encouraging  and  Increasing  of  Shipping 
and  Navigation. 

For  the  Increase  of  Shipping  and  Encouragement  of  the 
Navigation  of  this  Nation,  wherein,  under  the  good  Providence 
and  Protection  of  God,  the  Wealth,  Safety  and  Strength  of  this 
Kingdom  is  so  much  concerned  ;  (2)  Be  it  enacted  by  the  King's 
most  Excellent  Majesty,  and  by  the  Lords  and  Commons  in  this 
present  Parliament  assembled,  and  by  the  Authority  thereof, 
That  from  and  after  the  first  day  of  December,  one  thousand  six 
hundred  and  sixty,  and  from  thenceforward,  no  Goods  or  Com- 
modities whatsoever  shall  be  imported  into  or  exported  out  of 
any  Lands,  Islands,  Plantations  or  Territories  to  his  Majesty 
belonging  or  in  his  Possession,  or  which  may  hereafter  belong 
unto  or  be  in  the  Possession  of  his  Majesty,  his  Heirs  and  Suc- 
cessors, in  Asia,  Africa,  or  America,  in  any  other  Ship  or  Ships, 
Vessel  or  Vessels  whatsoever,  but  in  such  Ships  or  Vessels  as 
do  truly  and  without  Fraud  belong  only  to  the  People  of 
England  or  Ireland,  Dominion  of  Wales,  or  Town  of  Berwick 
upon  Tweed,  or  are  of  the  Built  of  and  belonging  to  any  the 
said  Lands,  Islands,  Plantations,  or  Territories,  as  the  Proprie- 
tors and  right  Owners  thereof,  and  whereof  the  Master  and  three- 
fourths  of  the  Mariners  at  least  are  English; 

III.  And  it  is  further  enacted  by  the  Authority  aforesaid, 
That  no  Goods  or  Commodities  whatsoever,  of  the  Growth, 
Production  or  Manufacture  of  Africa,  Asia  or  America,  or 


2  SELECTIONS. 

of  any  Part  thereof,  or  which  are  described  or  laid  down  in  the 
usual  Maps  or  Cards  of  those  Places,  be  imported  into  England, 
Ireland  or  Wales,  Islands  of  Guernsey  and  Jersey,  or  Town 
of  Berwick  upon  Tweed,  in  other  Ship  or  Ships,  Vessel  or 
Vessels  whatsoever,  but  in  such  as  do  truly  and  without  Fraud 
belong  only  to  the  People  of  England  or  Ireland,  Dominion  of 
Wales,  or  Town  of  Berwick  upon  Tweed,  or  of  the  Lands, 
Islands,  Plantations  or  Territories  in  Asia,  Africa,  or  America, 
to  his  Majesty  belonging,  as  the  Proprietors  and  right  Owners 
thereof,  and  whereof  the  Master,  and  three-fourths  at  least  of  the 
Mariners  are  English; 

IV.  And  it  is  further  enacted  by  the  Authority  aforesaid, 
That  no  Goods  or  Commodities  that  are  of  Foreign  Growth, 
Production  or  Manufacture,  and  which  are  to  be  brought  into 
England,  Ireland,  Wales,  the  Islands  of  Guernsey  and  Jersey, 
or  Town  of  Berwick  upon  Tweed,  in  English-\>\\\\\.  Shipping, 
or  other  Shipping  belonging  to  some  of  the  aforesaid  Places, 
and  navigated  by  English  Mariners,  as  aforesaid,  shall  be  shipped 
or  brought  from  any  other  Place  or  Places,  Country  or  Countries, 
but  only  from  those  of  the  said  Growth,  Production  or  Manu- 
facture, or  from  those  Ports  where  the  said  Goods  and  Com- 
modities can  only,  or  are,  or  usually  have  been,  first  shipped  for 
Transportation,  and  from  none  other  Place  or  Countries  ;  .  .  . 

VIII.  And  it  is  further  enacted  by  the  Authority  aforesaid, 
That  no  Goods  or  Commodities  of  the  Growth,  Production  or 
Manufacture  of  Muscovy,  or  of  any  the  Countries,  Dominions 
or  TeiTitories  to  the  Great  Duke  or  Emperor  of  Muscovy  or 
Russia  belonging;  as  also  that  no  Sort  of  Masts,  Timber  or 
Boards,  no  foreign  Salt,  Pitch,  Tar,  Rosin,  Hemp  or  Flax, 
Raisins,  Figs,  Prunes,  Olive-Oils,  no  Sorts  of  Corn  or  Grain,  Pot- 
Ashes,  Wines,  -Vinegar,  or  Spirits  called  Aqua-Vitae,  or 
Brandy-Wine,  shall  from  and  after  the  first  day  of  April,  which 
shall  be  in  the  Year  of  our  Lord  one  thousand  six  hundred  sixty- 
one,  be  imported  into  England,  Ireland,  Wales,  or  Town  of 
Berwick  upon  Tweed,  in  any  Ship  or  Ships,  Vessel  or  Vessels 
whatsoever,  but  in  such  as  do  truly  and  without  fraud  belong  to 
the  People  thereof,  or  some  of  them,  as  the  true  Owners  and 
Proprietors  thereof,  and  whereof  the  Master  and  three-fourths  of 
the  Mariners  at  least  are  English :  And  that  no  Currans  nor  Com- 


SECTIONS    FROM   ENGLISH    NAVIGATION   ACTS.  3 

modities  of  the  Growth,  Production  or  Manufacture  of  any  the 
Countries,  Islands,  Dominions  or  Territories  to  the  Ottoman  or 
Turkish  Empire  belonging,  shall  from  and  after  the  first  day  of 
September,  which  shall  be  in  the  year  of  our  Lord  one  thousand 
six  hundred  sixty-one,  be  imported  into  any  the  afore-mentioned 
places  in  any  Ship  or  Vessel,  but  which  is  of  English  built,  and 
navigated,  as  aforesaid,  and  in  no  other,  except  only  such  foreign 
Ships  and  Vessels  as  are  of  the  Built  of  that  Country  or  Place  of 
which  the  said  Goods  are  the  Growth,  Production  or  Manufact- 
ure respectively,  or  of  such  Port  where  the  said  Goods  can  only 
be,  or  most  usually  are,  first  shipped  for  Transportation,  and 
whereof  the  Master  and  three-fourths  of  the  Mariners  at  least  are 
of  the  said  Country  or  Place  ; 

XVIII.  And  it  is  further  enacted  by  the  Authority  aforesaid, 
That  from  and  after  the  first  Day  of  April,  which  shall  be  in  the 
Year  of  our  Lord  one  thousand  six  hundred  sixty-one,  no  Sugars, 
Tobacco,  Cotton-Wool,  Indigoes,  Ginger,  Fustick,  or  other  dying 
Wood,  of  the  Growth,  Production  or  Manufacture  of  any  Eng- 
lish Plantations  in  America,  Asia  or  Africa,  shall  be  shipped 
carried,  conveyed  or  transported  from  any  of  the  said  English 
Plantations  to  any  Land,  Island,  Territory,  Dominion,  Port  or 
Place  whatsoever,  other  than  to  such  other  English  Plantations 
as  do  belong  to  his  Majestv,  his  Heirs  and  Successors,  or  to  the 
kingdom  of  England  or  Ireland,  or  Principality  of  Wales,  or 
Town  of  Berwick  upon  Tweed,  there  to  be  laid  on  shore  ;  .  .  . 


ACT  OF  1662,  14  CAR.  II.,  c.  11. 

XXIII.  And  whereas  some  Doubts  and  Disputes  have  arisen 
concerning  the  said  late  Act,  For  increasing  and  encouraging 
of  Shipping  and  Navigation,  about  some  of  the  Goods  therein 
prohibited  to  be  brought  from  Holland  and  the  Parts  and  Ports 
thereabouts;  (2)  Be  it  enacted  and  declared,  that  no  Sort  of 
Wines,  (other  than  Rhenish}  no  Sort  of  Spicery,  Grocery, 
Tobacco,  Pot-Ashes,  Pitch,  Tar,  Salt,  Rozin,  Deal-Boards,  Fir, 
Timber,  or  Olive-Oil,  shall  be  imported  into  England,  Wales, 
or  Berwick,  from  the  Netherlands  or  Germany,  upon  any 
Pretence  whatsoever,  in  any  Sort  of  Ships  or  Vessels  whatso- 
ever: 


4  SELECTIONS. 

ACT  OF  1663,  15  CAR.  II.,  c.  7. 

V.  And  in  regard  his  Majesty's  Plantations  beyond  the  Seas 
are  inhabited  and  peopled  by  his  subjects  of  this  his  Kingdom  of 
England,    for  the    maintaining  a  greater  Correspondence    and 
Kindness  between  them,  and  keeping  them  in  a  further  Depend- 
ance    upon    it,   and  rendring  them  yet   more  beneficial  and  ad- 
vantageous unto  it    in 'the  further  Imployment  and   Increase  of 
English  Shipping  and   Seamen,  Vent   of  English  Woollen  and 
other  Manufactures  and   Commodities,  rendring  the  Navigation 
to  and  from    the  same    more   safe  and  cheap,  and  making  this 
Kingdom  a  Staple,  not  only  of  the  Commodities  of  those  planta- 
tions, but  also  of  the  Commodities  of  other  Countries  and  Places 
for  the   Supplying  of  them  ;    and   it  being  the    Usage  of    other 
Nations  to  keep  their  Plantations  Trade  to  themselves  : 

VI.  Be  it  enacted,  and  it  is  hereby  enacted,  That  from   and 
after  the  five   and  twentieth  Day  of  March,    one  thousand    six 
hundred  sixty-four,  no  Commodity  of  the  Growth,  Production  or 
Manufacture   of    Europe,    shall    be     imported   into    any    Land, 
Island,   Plantation,   Colony,  Territory,    or  Place  to  his  Majesty 
belonging,  or  which  shall  hereafter  belong  unto  or  be  in  the  Pos- 
session of  his  Majesty,  his  Heirs  and  Successors,  in  Asia,  Africa 
or  America,  (Tangier  only  excepted)  but  what   shall  be  bona- 
fide,  and  without  Fraud,  laden  and  shipped  in  England,  Wales, 
or  the  Town  of  Berwick  upon  Tweed,  and  in  English  built  Ship- 
ping, or  which  were   bona-fide    bought   before    the  first  day  of 
October  one  thousand  six  hundred  sixty  and    two,   and  had  such 
Certificate  thereof  as  is  directed  in  one  Act  passed  the  last  Sessions 
of  this  Present  Parliament,    intituled,   An  Act  for  preventing 
Frauds,  and  Regulating  Abuses  in  his  Majesty's  Customs',  and 
whereof  the  Master  and  three  Fourths  of  the  Mariners  at  least  are 
English,  and  which  shall  be  carried  directly  thence  to  the  said 
Lands,  Islands,  Plantations,  Colonies,  Territories,  or  Places,   and 
from  no  other  Place  or  Places  whatsoever ;  any  Law,  Statute,  or 
Usage   to  the  contrary  notwithstanding; 

See  English  Statutes  at  Large. 


COLONIAL    POLICY    OF   EUROPE.  5 

II. 
THE   COLONIAL   POLICY   OF   EUROPE. 

FROM   ADAM    SMITH'S    WEALTH   OF    NATIONS,    BOOK     IV.,    CH.    VII., 
PART    II. 

THE  colony  of  a  civilized  nation  which  takes  possession,  either 
of  a  waste  country  or  of  one  so  thinly  inhabited,  that  the  natives 
easily  give  place  to  the  new  settlers,  advances  more  rapidly  to 
wealth  and  greatness  than  any  other  human  society. 

The  colonists  carry  out  with  them  a  knowledge  of  agriculture 
and  of  other  useful  arts,  superior  to  what  can  grow  up  of  its  own 
accord  in  the  course  of  many  centuries  among  savage  and  bar- 
barous nations.  They  carry  out  with  them,  too,  the  habit  of 
subordination,  some  notion  of  the  regular  government  which  takes 
place  in  their  own  country,  of  the  system  of  laws  which  supports 
it,  and  of  a  regular  administration  of  justice  ;  and  they  naturally 
establish  something  of  the  same  kind  in  the  new  settlement.  But 
among  savage  and  barbarous  nations,  the  natural  progress  of  law 
and  government  is  still  slower  than  the  natural  progress  of  arts, 
after  law  and  government  hare  been  so  far  established  as  is 
necessary  for  their  protection.  Every  colonist  gets  more  land 
than  he  can  possibly  cultivate.  He  has  no  rent,  and  scarce  any 
taxes  to  pay.  No  landloi'd  shares  with  him  in  its  produce,  and 
the  share  of  the  sovereign  is  commonly  but  a  trifle.  He  has 
every  motive  to  render  as  great  as  possible  a  produce,  which  is 
thus  to  be  almost  entirely  his  own.  But  his  land  is  commonly  so 
extensive,  that  with  all  his  own  industry,  and  with  all  the  industry 
of  other  people  whom  he  can  get  to  employ,  he  can  seldom  make 
it  produce  the  tenth  part  of  what  it  is  capable  of  producing.  He 
is  eager,  therefore,  to  collect  laborers  from  all  quarters,  and  to 
rewai'd  them  with  the  most  liberal  wages.  But  those  liberal 
wages,  joined  to  the  plenty  and  cheapness  of  land,  soon  make 
those  laborers  leave  him,  in  order  to  become  landlords  them- 
selves, and  to  reward,  with  equal  liberality,  other  laborers,  who 
soon  leave  them  for  the  same  reason  that  they  left  their  first 
master.  The  liberal  reward  of  labor  encourages  marriage.  The 
children,  during  the  tender  years  of  infancy,  are  well  fed  and 


6  SELECTIONS. 

properly  taken  care  of,  and  when  they  are  grown  up,  the  value  of 
their  labor  greatly  overpays  their  maintenance.  When  arrived 
at  maturity,  the  high  price  of  labor,  and  the  low  price  of  land, 
enable  them  to  establish  themselves  in  the  same  manner  as  their 
fathers  did  before  them. 

In  other  countries  rent  and  profit  eat  up  wages,  and  the 
two  superior  orders  of  people  oppress  the  inferior  one.  But  in 
new  colonies  the  interest  of  the  two  superior  orders  obliges  them 
to  treat  the  inferior  one  with  more  generosity  and  humanity ;  at 
least,  where  that  inferior  one  is  not  in  a  state  of  slavery.  Waste 
lands  of  the  greatest  natural  fertility,  are  to  be  had  for  a  trifle. 
The  increase  of  revenue  which  the  proprietor,  who  is  always  the 
undertaker,  expects  from  their  improvement,  constitutes  his  profit ; 
which  in  these  circumstances  is  commonly  very  great.  But  this 
great  profit  cannot  be  made  without  employing  the  labor  of  other 
people  in  clearing  and  cultivating  the  land  ;  and  the  disproportion 
between  the  great  extent  of  the  land  and  the  small  number  of  the 
people,  which  commonly  takes  place  in  new  colonies,  makes  it 
difficult  for  him  to  get  this  labor.  He  does  not,  therefore,  dispute 
about  wages,  but  is  willing  to  employ  labor  at  any  price.  The 
high  wages  of  labor  encourage  population.  The  cheapness  and 
plenty  of  good  land  encourage  improvement,  and  enable  the  pro- 
prietor to  pay  those  high  wages.  In  those  wages  consists  almost 
the  whole  price  of  the  land  ;  and  though  they  are  high,  considered 
as  the  wages  of  labor,  they  are  low,  considered  as  the  price  of  what 
is  so  very  valuable.  What  encourages  the  progress  of  population 
and  improvement  encourages  that  of  real  wealth  and  greatness. 

The  progress  of  many  of  the  ancient  Greek  colonies  towards 
wealth  and  greatness  seems  accordingly  to  have  been  very  rapid. 
In  the  course  of  a  century  or  two  several  of  them  appear  to  have 
rivalled,  and  even  to  have  surpassed,  their  mother  cities.  Syra- 
cuse and  Agrigentum  in  Sicily,  Tarentum  and  Locri  in  Italy, 
Ephesus  and  Miletus  in  Lesser  Asia,  appear  by  all  accounts  to 
have  been  at  least  equal  to  any  of  the  cities  of  ancient  Greece. 
Though  posterior  in  their  establishment,  yet  all  the  arts  of  refine- 
ment, philosophy,  poetry,  and  eloquence,  seem  to  have  been  cul- 
tivated as  early,  and  to  have  been  improved  as  highly,  in  them,  as 
in  any  part  of  the  mother  country.  The  schools  of  the  two  oldest 
Greek  philosophers,  those  of  Thales  and  Pythagoras,  were  estab- 
lished, it  is  remarkable,  not  in  ancient  Greece,  but  the  one  in  an 
Asiatic,  the  other  in  an  Italian  colony.  All  those  colonies  had 


COLONIAL   POLICY   OF   EUROPE.  7 

established  themselves  in  countries  inhabited  by  savage  and  bar- 
barous nations,  who  easily  gave  place  to  the  new  settlers.  They 
had  plenty  of  good  land,  and  as  they  were  altogether  independent 
of  the  mother  city,  they  were  at  liberty  to  manage  their  own  affairs 
in  the  way  that  they  judged  was  most  suitable  to  their  own 
interest. 

The  history  of  the  Roman  colonies  is  by  no  means  so  brilliant. 
Some  of  them,  indeed,  such  as  Florence,  have  in  the  course  of 
many  ages,  and  after  the  fall  of  the  mother  city,  grown  up  to  be 
considerable  States.  But  the  progress  of  no  one  of  them  seems 
ever  to  have  been  very  rapid.  They  were  all  established  in  con- 
quered provinces,  \vhich  in  most  cases  had  been  fully  inhabited 
before.  The  quantity  of  land  assigned  to  each  colonist  was 
seldom  very  considerable,  and,  as  the  colony  was  not  independent, 
they  were  not  always  at  liberty  to  manage  their  own  affairs  in 
the  way  that  they  judged  was  most  suitable  to  their  own  interest. 

In  the  plenty  of  good  land  the  European  colonies  established  in 
America  and  the  West  Indies  resemble,  and  even  greatly  surpass, 
those  of  ancient  Greece.  In  their  dependency  upon  the  mother 
State  they  resemble  those  of  ancient  Rome  ;  but  their  great  distance 
from  Europe  has  in  all  of  them  alleviated  more  or  less  the  effects 
of  this  dependency.  Their  situation  has  placed  them  less  in  the 
view  and  less  in  the  power  of  their  mother  country.  In  pur- 
suing their  interest  their  own  way,  their  conduct  has,  upon 
many  occasions,  been  overlooked,  either  because  not  known 
or  not  understood  in  Europe  ;  and  upon  some  occasions  it  has 
been  fairly  suffered  and  submitted  to,  because  their  distance 
rendered  it  difficult  to  restrain  it.  Even  the  violent  and  arbitrary 
government  of  Spain  has,  upon  many  occasions,  been  obliged  to 
recall  or  soften  the  orders  which  had  been  given  for  the  govern- 
ment of  her  colonies,  for  fear  of  a  general  insurrection.  The 
progress  of  all  the  European  colonies  in  wealth,  population,  and 
improvement,  has  accordingly  been  very  great. 

The  crown  of  Spain,  by  its  share  of  the  gold  and  silver,  derived 
some  revenue  from  its  colonies,  from  the  moment  of  their  first 
establishment.  It  was  a  revenue,  too,  of  a  nature  to  excite  in 
human  avidity  the  most  extravagant  expectations  of  still  greater 
riches.  The  Spanish  colonies,  therefore,  from  the  moment  of 
their  first  establishment,  attracted  very  much  the  attention  of  their 
mother  country  ;  while  those  of  the  other  European  nations  were 
for  a  long  time  in  a  great  measure  neglected.  The  former  did 


8  SELECTIONS. 

not,  perhaps,  thrive  the  better  in  consequence  of  this  attention  : 
nor  the  latter  the  worse  in  consequence  of  this  neglect.  In  pro- 
portion to  the  extent  of  the  country  which  they  in  some  measure 
possess,  the  Spanish  colonies  are  considered  as  less  populous  and 
thriving  than  those  of  almost  any  other  European  nation.  The 
progress  even  of  the  Spanish  colonies,  however,  in  population 
i;-  and  improvement,  has  certainly  been  very  rapid  and  very  great. 
The  city  of  Lima,  founded  since  the  conquest,  is  represented  in 
Ulloa,  as  containing  fifty  thousand  inhabitants  near  thirty  years 
ago.  Quito,  which  had  been  but  a  miserable  hamlet  of  Indians, 
is  represented  by  the  same  author  as  in  his  time  equally  populous. 
Gemelli  Carreri,  a  pretended  traveller,  it  is  said,  indeed,  but  who 
.  seems  everywhere  to  have  written  upon  extreme  good  informa- 
tion, represents  the  city  of  Mexico  as  containing  a  hundred  thou- 
sand inhabitants  ;  a  number  which,  in  spite  of  all  the  exaggerations 
of  the  Spanish  writers,  is,  probably,  more  than  five  times  greater 
than  what  it  contained  in  the  time  of  Montezuma.  These  num- 
bers exceed  greatly  those  of  Boston,  New  York,  and  Philadelphia, 
the  three  greatest  cities  of  the  English  colonies.  Before  the  con- 
quest of  the  Spaniards  there  were  no  cattle  fit  for  draught  either 
in  Mexico  or  Peru.  The  lama  was  their  only  beast  of  burden, 
and  its  strength  seems  to  have  been  a  good  deal  inferior  to  that  of 
a  common  ass.  The  plough  was  unknown  among  them.  They 
were  ignorant  of  the  use  of  iron.  They  had  no  coined  money, 
nor  any  established  instrument  of  commerce  of  any  kind.  Their 
commerce  was  carried  on  by  barter.  A  sort  of  wooden  spade 
was  their  principal  instrument  of  agriculture.  Sharp  stones 
served  them  for  knives  and  hatchets  to  cut  with  ;  fish-bones  and 
the  hard  sinews  of  certain  animals  served  them  for  needles  to  sew 
with  ;  and  these  seem  to  have  been  their  principal  instruments  of 
trade.  In  this  state  of  things  it  seems  impossible,  that  either  of 
those  empires  could  have  been  so  much  improved  or  so  well 
cultivated  as  at  present,  when  they  are  plentifully  furnished  with 
all  sorts  of  European  cattle,  and  when  the  use  of  iron,  of  the 
plough,  and  of  many  of  the  arts  of  Europe,  has  been  introduced 
among  them.  But  the  populousness  of  every  country  must  be  in 
proportion  to  the  degree  of  its  improvement  and  cultivation.  In 
spite  of  the  cruel  destruction  of  the  natives  which  followed  the 
conquest,  these  two  great  empires  are,  probably,  more  populous 
now  than  they  ever  were  before  ;  and  the  people  are  surely  very 
different ;  for  we  must  acknowledge,  I  apprehend,  that  the 


COLONIAL   POLICY    OF   EUROPE.  9 

Spanish  Creoles  are  in  many  respects  superior  to  the  ancient 
Indians. 

After  the  settlements  of  the  Spaniards,  that  of  the  Portuguese 
in  Brazil  is  the  oldest  of  any  European  nation  in  America.  But 
as  for  a  long  time  after  the  first  discovery,  neither  gold  nor  silver 
mines  were  found  in  it,  and  as  it  afforded,  upon  that  account, 
little  or  no  revenue  to  the  crown,  it  was  for  a  long  time  in  a  great 
measure  neglected  ;  and  during  this  state  of  neglect  it  giew  up  to 
be  a  great  and  powerful  colony.  While  Portugal  was  under  the 
dominion  of  Spain,  Brazil  was  attacked  by  the  Dutch,  who  got 
possession  of  seven  of  the  fourteen  provinces  into  which  it  is 
divided.  They  expected  soon  to  conquer  the  other  seven,  when 
Portugal,  recovered  its  independency  by  the  elevation  of  the  family 
of  Braganza  to  the  throne.  The  Dutch  then,  as  enemies  to  the 
Spaniards,  became  friends  to  the  Portuguese,  who  were  likewise 
the  enemies  of  the  Spaniards.  They  agreed,  therefore,  to  leave 
that  part  of  Brazil,  which  they  had  not  conquered,  to  the  king  of 
Portugal  who  agreed  to  leave  that  part  which  they  had  conquered 
to  them,  as  a  matter  not  worth  disputing  about  with  such  good  allies. 
But  the  Dutch  government  soon  began  to  oppress  the  Portuguese 
colonists,  who,  instead  of  amusing  themselves  with  complaints,  took 
arms  against  their  new  masters,  and  by  their  own  valor  and  reso- 
lution, with  the  connivance  indeed,  but  without  any  avowed 
assistance  from  the  mother  country,  drove  them  out  of  Brazil. 
The  Dutch,  therefore,  finding  it  impossible  to  keep  any  part  of  the 
country  to  themselves,  were  contented  that  it  should  be  entirely 
restored  to  the  crown  of  Portugal.  In  this  colony  there  are  said 
to  be  more  than  six  hundred  thousand  people,  either  Portuguese 
or  descended  from  Portuguese,  Creoles,  mulattoes,  and  a  mixed 
race  between  Portuguese  and  Brazilians.  No  one  colony  in 
America  is  supposed  to  contain  so  great  a  number  of  people  of 
European  extraction. 

Towards  the  end  of  the  fifteenth  and  during  the  greater  part  of 
the  sixteenth  century  Spain  and  Portugal  were  the  two  great 
naval  powers  upon  the  ocean  ;  for  though  the  commerce  of  Venice 
extended  to  every  part  of  Europe,  its  fleets  had  scarce  ever  sailed 
beyond  the  Mediterranean.  The  Spaniards,  in  virtue  of  the  first 
discovery,  claimed  all  America  as  their  own  ;  and  though  they 
could  not  hinder  so  great  a  naval  power  as  that  of  Portugal  from 
settling  in  Brazil,  such  was,  at  that  time,  the  terror  of  their  name, 
that  the  greater  part  of  the  other  nations  of  Europe  were  afraid 


10  SELECTIONS. 

to  establish  themselves  in  any  other  part  of  that  great  continent. 
The  French,  who  attempted  to  settle  in  Florida,  were  all  mur- 
dered by  the  Spaniards.  But  the  declension  of  the  naval  power 
of  this  latter  nation,  in  consequence  of  the  defeat  or  miscarriage 
of,  what  they  called,  their  Invincible  Armada,  which  happened 
towards  the  end  of  the  sixteenth  century,  put  it  out  of  their  power 
to  obstruct  any  longer  the  settlements  of  the  other  European 
nations.  In  the  course  of  the  seventeenth  century,  therefore,  the 
English,  French,  Dutch,  Danes,  and  Swedes,  all  the  great  nations 
who  had  any  ports  upon  the  ocean,  attempted  to  make  some  set- 
tlements in  the  new  world. 

The  Swedes  established  themselves  in  New  Jersey  ;  and  the 
number  of  Swedish  families  still  to  be  found  there,  sufficiently 
demonstrates,  that  this  colony  was  very  likelv  to  prosper,  had  it 
been  protected  by  the  mother  country.  But  being  neglected  by 
Sweden,  it  was  soon  swallowed  up  by  the  Dutch  colony  of  New 
York,  which  again,  in  1674,  fell  under  the  dominion  of  the 
English. 

The  small  islands  of  St.  Thomas  and  Santa  Cruz  are  the  only 
countries  in  the  new  world  that  have  ever  been  possessed  by  the 
Danes.  These  little  settlements  too  were  under  the  government 
of  an  exclusive  company,  which  had  the  sole  right,  both  of  pur- 
chasing the  surplus  produce  of  the  colonists,  and  of  supplying 
them  with  such  goods  of  other  countries  as  they  wanted,  and 
which,  therefore,  both  in  its  purchases  and  sales,  had  not  only  the 
power  of  oppressing  them,  but  the  greatest  temptation  to  do  so. 
The  government  of  an  exclusive  company  of  merchants  is,  per- 
haps, the  worst  of  all  governments  for  any  country  whatever.  .It 
was  not,  however,  able  to  stop  altogether  the  progress  of  these 
colonies,  though  it  rendered  it  more  slow  and  languid.  The  late 
king  of  Denmark  dissolved  this  company,  and  since  that  time  the 
prosperity  of  these  colonies  has  been  very  great. 

The  Dutch  settlements  in  the  West,  as  well  as  those  in  the  East 
Indies,  were  originally  put  under  the  government  of  an  exclusive 
company.  The  progi'ess  of  some  of  them,  therefore,  though  it 
has  been  considerable,  in  comparison  with  that  of  almost  any 
country  that  has  been  long  peopled  and  established,  has  been 
languid  and  slow  in  comparison  with  that  of  the  greater  part  of 
new  colonies.  The  colony  of  Surinam,  though  very  considerable, 
is  still  inferior  to  the  greater  part  of  the  sugar  colonies  of  the 
other  European  nations.  The  colony  of  Nova  Belgia,  now  di- 


COLONIAL   POLICY    OF   EUROPE.  II 

vided  into  the  two  provinces  of  New  York  and  New  Jersey, 
•would  probably  have  soon  become  considerable  too,  even  though 
it  had  remained  under  the  government  of  the  Dutch.  The 
plenty  and  cheapness  of  good  land  are  such  powerful  causes  of 
prosperity,  that  the  very  worst  government  is  scarce  capable  of 
checking  altogether  the  efficacy  of  their  operation.  The  great 
distance  too,  from  the  mother  country  would  enable  the  colonists 
to  evade  more  or  less,  by  smuggling,  the  monopoly  which  the 
company  enjoyed  against  them.  At  present  the  company  allows  all 
Dutch  ships  to  trade  to  Surinam  upon  paying  two  and  a  half  per 
cent,  upon  the  value  of  their  cargo  for  a  license  ;  and  onlv  re- 
serves to  itself  exclusively  the  direct  trade  from  Africa  to  Ameri- 
ca, which  consists  almost  entirely  in  the  slave  trade.  This 
relaxation  in  the  exclusive  privileges  of  the  company  is  probably 
the  principal  cause  of  that  degree  of  prosperity  which  that  colony 
at  present  enjoys.  Cui^oa  and  Eustatia,  the  two  principal 
islands  belonging  to  the  Dutch,  are  free  ports  open  to  the  ships 
of  all  nations;  and  this  freedom,  in  the  midst  of  better  colonies 
whose  ports  are  open  to  those  of  one  nation,  only,  has  been  the 
great  cause  of  the  prosperity  of  those  two  barren  islands. 

The  French  colony  of  Canada  was,  during  the  greater  part  of 
the  last  century,  and  some  part  of  the  present,  under  the  govern- 
ment of  an  exclusive  company.  Under  so  unfavorable  an  admin- 
istration its  progress  was  necessarily  very  slow  in  comparison 
with  that  of  other  new  colonies  ;  but  it  became  much  more  rapid 
when  this  company  was  dissolved  after  the  fall  of  what  is  called 
the  Mississippi  scheme.  When  the  English  got  possession  of 
this  country,  they  found  in  it  near  double  the  number  of  inhabi- 
tants which  father  Charlevoix  had  assigned  to  it  between  twenty 
and  thirty  years  before.  That  Jesuit  had  travelled  over  the  whole 
country,  and  had  no  inclination  to  represent  it  as  less  considerable 
than  it  really  was. 

The  French  colony  of  St.  Domingo  was  established  by  pirates 
and  freebooters,  who,  for  a  long  time,  neither  required  the  pro- 
tection, nor  acknowledged  the  authority,  of  France  ;  and,  when 
that  race  of  banditti  became  so  far  citizens  as  to  acknowledge  this 
authority,  it  was  for  a  long  time  necessary  to  exei'cise  it  with  very 
great  gentleness.  During  this  period  the  population  and  im- 
provement of  this  colony  increased  very  fast.  Even  the  oppres- 
sion of  the  exclusive  company,  to  which  it  was  for  some  time 
subjected,  with  all  the  other  colonies  of  France,  though  it  no 


12  SELECTIONS. 

doubt  retarded,  had  not  been  able  to  stop  its  progress  altogether. 
The  course  of  its  prosperity  returned  as  soon  as  it  was  relieved 
from  that  oppression.  It  is  now  the  most  important  of  the 
sugar  colonies  of  the  West  Indies,  and  its  produce  is  said  to  be 
greater  than  that  of  all  the  English  sugar  colonies  put  together. 
The  other  sugar  colonies  of  France  are  in  general  all  very 
thriving. 

But  there  are  no  colonies  of  which  the  progress  has  been  more 
rapid  than  that  of  the  English  in  North  America. 

Plenty  of  good  land  and  liberty  to  manage  their  own  affairs 
their  own  way,  seem  to  be  the  two  great  causes  of  the  prosperity 
of  all  new  colonies. 

In  the  plenty  of  good  land,  the  English  colonies  of  North 
America,  though,  no  doubt,  very  abundantly  provided,  are,  how- 
ever, inferior  to  those  of  the  Spaniards  and  Portuguese,  and  not 
superior  to  some  of  those  possessed  by  the  French  before  the  late 
war.  But  the  political  institutions  of  the  English  colonies  have 
been  more  favorable  to  the  improvement  and  cultivation  of  this 
land  than  those  of  any  of  the  other  three  nations. 

First,  the  engrossing  of  uncultivated  land,  though  it  has  by  no 
means  been  prevented  altogether,  has  been  more  restrained  in  the 
English  colonies  than  in  any  other.  The  colony  law  which  im- 
poses upon  every  proprietor  the  obligation  of  improving  and 
cultivating,  within  a  limited  time,  a  certain  proportion  of  his 
lands,  and  which,  in  case  of  failure,  declares  those  neglected  lands 
grantable  to  any  other  person  ;  though  it  has  not,  perhaps,  been 
very  strictly  executed,  has.  however,  had  some  effect. 

Secondly,  in  Pennsylvania  there  is  no  right  of  primogeniture, 
and  lands,  like  movables,  are  divided  equally  among  all  the 
children  of  the  family.  In  three  of  the  provinces  of  New  Eng- 
land the  oldest  has  only  a  double  share,  as  in  the  Mosaical  law. 
Though  in  those  provinces,  therefore,  too  great  a  quanlity  of  land 
should  sometimes  be  engrossed  by  a  particular  individual,  it  is 
likely,  in  the  course  of  a  generation  or  two,  to  be  sufficiently 
divided  again.  In  the  other  English  colonies,  indeed,  the  right 
of  primogeniture  takes  place,  as  in  the  law  of  England.  But  in 
all  the  English  colonies  the  tenure  of  the  lands,  which  are  all 
held  by  free  socage,  facilitates  alienation,  and  the  grantee  of  any 
extensive  tract  of  land  generally  finds  it  for  his  interest  to 
alienate,  as  fast  as  he  can,  the  greater  part  of  it,  reserving 
only  a  small  quit-rent.  In  the  Spanish  and  Portuguese 


COLONIAL   POLICY    OF   EUROPE.  13 

colonies,  what  is  called  the  right  of  Majorazzo1  takes  place 
in  the  succession  of  all  those  great  estates  to  which  any  title  of 
honor  is  annexed.  Such  estates  go  all  to  one  person,  and  are  in 
effect  entailed  and  unalienable.  The  French  colonies,  indeed, 
are  subject  to  the  custom  of  Paris,  which,  in  the  inheritance  of 
land,  is  much  more  favorable  to  the  younger  children  than  the 
law  of  England.  But,  in  the  French  colonies,  if  any  part  of  an 
estate,  held  by  the  noble  tenure  of  chivalry  and  homage,  is  alien- 
ated, it  is,  for  a  limited  time,  subject  to  the  right  of  redemption, 
either  by  the  heir  of  the  superior  or  by  the  heir  of  the  family  ;  and 
all  the  largest  estates  of  the  country  are  held  by  such  noble  ten- 
ures, which  necessarily  embarrass  alienation.  But,  in  a  new 
colony,  a  great  uncultivated  estate  is  likely  to  be  much  more 
speedily  divided  by  alienation  than  by  succession.  The  plenty 
and  cheapness  of  good  land,  it  has  already  been  observed,  are 
the  principal  causes  of  the  rapid  prosperity  of  new  colonies.  The 
engrossing  of  land,  in  effect,  destroys  this  plenty  and  cheapness. 
The  engrossing  of  uncultivated  land,  besides,  is  the  greatest  ob- 
struction to  its  improvement.  But  the  labor  that  is  employed  in 
the  improvement  and  cultivation  of  land  affords  the  greatest  and 
most  valuable  produce  to  the  society.  The  produce  of  labor,  in 
this  case,  pays  not  only  its  own  wages,  and  the  profit  of  the  stock 
which  employs  it,  but  the  rent  of  the  land  too  upon  which  it  is 
employed.  The  labor  of  the  English  colonists,  therefore,  being 
more  employed  in  the  improvement  and  cultivation  of  land,  is 
likely  to  afford  a  greater  and  more  valuable  produce,  than  that  of 
any  of  the  other  three  nations,  which,  by  the  engrossing  of  land, 
is  more  or  less  diveited  toward  other  employments. 

Thirdly,  the  labor  of  the  English  colonists  is  not  only  likely  to 
afford  a  greater  and  more  valuable  produce,  but,  in  consequence 
of  the  moderation  of  their  taxes,  a  greater  proportion  of  this  prod- 
uce belongs  to  themselves,  which  they  may  store  up  and  employ 
in  putting  into  motion  a  still  greater  quantity  of  labor.  The 
English  colonists  have  never  yet  contributed  anything  towards  the 
defence  of  the  mother  country,  or  towards  the  support  of  its  civil 
government.  They  themselves,  on  the  contrary,  have  hitherto 
been  defended  almost  entirely  at  the  expense  of  the  mother 
country.  But  the  expense  of  fleets  and  armies  is  out  of  all  pro- 
portion greater  than  the  necessary  expense  of  civil  government. 

"Jus  Majoratus. 


14  SELECTIONS. 

The  expense  of  their  own  civil  government  has  always  been  very 
moderate.     It  has  generally  been  confined  to  what  was  necessary 
for  paying  competent  salaries  to  the  governor,  to  the  judges,  and 
to  some  other  officers  of  police,  and  for  maintaining  a  few  of  the 
most  useful  public  works.     The  expense  of  the  civil  establishment 
of  Massachusetts  Bay,  before  the  commencement  of  the  present 
disturbances,  used  to  be  but  about  £18,000  a  year  ;  that  of  New 
Hampshire  and  Rhode  Island,  £3,500  each  ;  that  of  Connecticut, 
£4,000 ;    that   of  New  York    and   Pennsylvania,   £4,500  each ; 
that  of  New  Jersey,  £1,200;  that  of  Virginia  and  South  Caro- 
lina, £8,000  each.     The  civil  establishments  of  Nova  Scotia  and 
Georgia  are  partly  supported  by  an   annual  grant  of  Parliament. 
But  Nova  Scotia  pays,  besides,  about  £7,000  a  year  towards  the 
public  expenses  of  the  colony ;  and  Georgia  about  £2,500  a  year. 
All  the  different  civil  establishments  in  North  America,  in  short, 
exclusive  of  those  of  Maryland  and  North  Carolina,  of  which  no 
exact  account  has  been  got,  did  not,  before  the  commencement  of 
the    present  disturbances,   cost  the  inhabitants  above  £64,700  a 
year ;  an  ever-memorable  example  at  how  small  an  expense  three 
millions  of  people  mav  not  only  be  governed,  but  well  governed. 
The  most  important  part  of  the  expense  of  government,  indeed, 
that   of  defence   and   protection,   has  constantly  fallen   upon  the 
mother  country.     The  ceremonial,  too,  of  the  civil  government  in 
the    colonies,  upon   the  reception  of  a   new  governor,  upon  the 
opening  of  a  new  assembly,  etc.,  though  sufficiently  decent,  is  not 
accompanied  with  any  expensive  pomp  or  parade.     Their  eccle- 
siastical government  is   conducted   upon   a   plan   equally  frugal. 
Tithes  are  unknown  among  them  ;  and  their  clergy,  who  are  far 
from   being  numerous,   are    maintained    either  by   moderate   sti- 
pends,  or  by  the   voluntary  contributions  of  the    people.     The 
power  of  Spain   and   Portugal,   on   the    contrary,   derives   some 
support   from    the    taxes    levied    upon    their    colonies.      France, 
indeed,    has    never    drawn    any   considerable    revenue    from    its 
colonies,  the    taxes    which    it    levies  upon  them  being  generally 
spent    among    them.     But    the    colony  government  of  all   these 
three  nations  is  conducted  upon  a  much    more  expensive    plan 
and     is    accompanied     with    a     much     more     expensive     cere- 
monial.       The    sums    spent     upon    the    reception    of    a    new 
viceroy    of    Peru,     for    example,    have    frequently    been    enor- 
mous.     Such  ceremonials  are  not  only  real  taxes  paid  by  the  rich 
colonists  upon  those  particular  occasions,  but  they  serve   to  intro- 


COLONIAL   POLICY   OF   EUROPE.  15 

duce  among  them  the  habit  of  vanity  and  expense  upon  all  other 
occasions.  They  are  not  only  very  grievous  occasional  taxes,  but 
they  contribute  to  establish  perpetual  taxes  of  the  same  kind  still 
more  grievous  ;  the  ruinous  taxes  of  private  luxury  and  extrava- 
gance. In  the  colonies  of  all  those  three  nations  too,  the  ecclesi- 
astical government  is  extremely  oppressive.  Tithes  take  place 
in  all  of  them,  and  are  levied  with  the  utmost  rigor  in  those  of 
Spain  and  Portugal.  All  of  them  besides  are  oppressed  with  a 
numerous  race  of  mendicant  friars,  whose  beggary  being  not  only 
licensed  but  consecrated  by  religion,  is  a  most  grievous  tax  upon 
the  poor  people,  who  are  most  carefully  taught  that  it  is  a  duty 
to  give,  and  a  very  great  sin  to  refuse  them  their  charity.  Over 
and  above  all  this,  the  clergy  are,  in  all  of  them,  the  greatest  en- 
grossers of  land. 

Fourthly,  in  the  disposal  of  their  surplus  produce,  or  of  what 
is  over  and  above  their  own  consumption,  the  English  colonies 
have  been  more  favored,  and  have  been  allowed  a  more  extensive 
market,  than  those  of  any  other  European  nation.  Every  Euro- 
pean nation  has  endeavored,  more  or  less,  to  monopolize  to  itself 
the  commerce  of  its  colonies,  and,  upon  that  account,  has  pro- 
hibited the  ships  of  foreign  nations  from  trading  to  them,  and  has 
prohibited  them  from  importing  European  goods  from  any  foreign 
nation.  But  the  manner  in  which  this  monopoly  has  been, 
exercised  in  different  nations  has  been  very  different. 

Some  nations  have  given  up  the  whole  commerce  of  their 
colonies  to  an  exclusive  company,  of  whom  the  colonies  were 
obliged  to  buy  all  such  European  goods  as  they  wanted,  and  to 
whom  they  were  obliged  to  sell  the  whole  of  their  own  surplus 
produce.  It  was  the  interest  of  the  company,  therefore,  not  only 
to  sell  the  former  as  dear,  and  to  buy  the  latter  as  cheap  as  possi- 
ble, but  to  buy  no  more  of  the  latter,  even  at  this  low  price,  than 
what  they  could  dispose  of  for  a  very  high  price  in  Europe.  It 
was  their  interest  not  only  to  degrade  in  all  cases  the  value  of  the 
surplus  produce  of  the  colony,  but  in  many  cases  to  discourage 
and  keep  down  the  natural  increase  of  its  quantity.  Of  all  the 
expedients  that  can  well  be  contrived  to  stunt  the  natural  growth 
of  a  new  colony,  that  of  an  exclusive  company  is  undoubtedly  the 
most  effeclual.  This,  however,  has  been  the  policy  of  Holland, 
though  their  company,  in  the  course  of  the  present  century,  has 
given  up  in  many  respects  the  exertion  of  their  exclusive  privi- 
lege. This,  too,  was  the  policy  of  Denmark  till  the  reign  of  the 


1 6  SELECTIONS. 

late  king.  It  has  occasionally  been  the  policy  of  France,  and  of 
late,  since  1755,  after  it  had  been  abandoned  by  all  other  nations, 
on  account  of  its  absurdity,  it  has  become  the  policy  of  Portugal 
with  regard  at  least  to  two  of  the  principal  provinces  of  Brazil, 
Pernambuco  and  Marannon. 

Other  nations,  without  establishing  an  exclusive  company, 
have  confined  the  whole  commerce  of  their  colonies  to  a  particular 
port  of  the  mother  country,  from  whence  no  ship  was  allowed  to 
sail,  but  either  in  a  fleet  and  at  a  particular  season,  or,  if  single,  in 
consequence  of  a  particular  license,  which,  in  most  cases,  was 
very  well  paid  for.  This  policy  opened,  indeed,  the  trade  of  the 
colonies  to  all  the  natives  of  the  mother  country,  provided  they 
traded  from  the  proper  port,  at  the  proper  season,  and  in  the 
proper  vessels.  But  as  all  the  different  merchants,  who  joined 
their  stocks  in  order  to  fit  out  those  licensed  vessels,  would  find 
it  for  their  interest  to  act  in  concert,  the  trade  which  was  carried 
on  in  this  manner  would  necessarily  be  conducted  very  nearly 
upon  the  same  principles  as  that  of  an  exclusive  company.  The 
profit  of  those  merchants  would  be  almost  equally  exorbitant  and 
oppressive.  The  colonies  would  be  ill  supplied,  and  would  be 
obliged  both  to  buy  very  dear,  and  to  sell  very  cheap.  This, 
however,  till  within  these  few  years,  had  always  been  the  policy 
of  Spain,  and  the  price  of  all  European  goods,  accordingly,  is 
said  to  have  been  enormous  in  the  Spanish  West  Indies.  At 
Quito,  we  are  told  by  Ulloa,  a  pound  of  iron  sold  for  about  four 
and  sixpence,  and  a  pound  of  steel  for  about  six  and  ninepence 
sterling.  But  it  is  chiefly  in  order  to  purchase  European 
goods,  that  the  colonies  part  with  their  own  produce.  The 
more,  therefore,  they  pay  for  the  one,  the  less  they  really 
get  for  the  other,  and  the  dearness  of  the  one  is  the  same  thing 
with  the  cheapness  of  the  other.  The  policy  of  Portugal  is  in 
this  respect  the  same  as  the  ancient  policy  of  Spain,  with  regard 
to  all  its  colonies,  except  Pernambuco  and  Marannon,  and  with 
regard  to  these  it  has  lately  adopted  a  still  worse. 

Other  nations  leave  the  trade  of  their  colonies  free  to  all  their 
subjects,  who  may  carry  it  on  from  all  the  different  ports  of  the 
mother  country,  and  who  have  occasion  for  no  other  license  than 
the  common  dispatches  of  the  custom-house.  In  this  case  the 
number  and  dispersed  situation  of  the  different  traders  render  it' 
impossible  for  them  to  enter  into  any  general  combination,  and 
their  competition  is  sufficient  to  hinder  them  from  making  very 


COLONIAL   POLICY   OF   EUROPE.  I/ 

exorbitant  profits.  Under  so  liberal  a  policy  the  colonies  are 
enabled  both  to  sell  their  own  produce  and  to  buy  the  goods  of 
Europe  at  a  reasonable  price.  But  since  the  dissolution  of  the 
Plymouth  company,  when  our  colonies  were  but  in  their  infancy, 
this  has  always  been  the  policy  of  England.  It  has  generally  too 
been  that  of  France,  and  has  been  uniformly  so  since  the  dissolu- 
tion of  what,  in  England,  is  commonly  called  their  Mississippi 
company.  The  profits  of  the  trade,  therefore,  which  France  and 
England  carry  on  with  their  colonies,  though  no  doubt  somewhat 
higher  than  if  the  competition  was  free  to  all  other  nations,  are, 
however,  by  no  means  exorbitant ;  and  the  price  of  European 
goods  accordingly  is  not  extravagantly  high  in  the  greater  part  of 
the  colonies  of  either  of  those  nations. 

In  the  exportation  of  their  own  surplus  produce  too,  it  is  only 
with  regard  to  certain  commodities  that  the  colonies  of  Great 
Britain  are  confined  to  the  market  of  the  mother  country.  These 
commodities  having  been  enumerated  in  the  act  of  navigation  and 
in  some  other  subsequent  acts,  have  upon  that  account  been  called 
enumerated  commodities.  The  rest  are  called  non-enumerated  ; 
and  may  be  exported  directly  to  other  countries,  provided  it  is  in 
British  or  Plantation  ships,  of  which  the  owners  and  three-fourths 
of  the  mariners  are  British  subjects. 

Among  the  non-enumerated  commodities  are  some  of  the  most 
important  productions  of  America  and  the  West  Indies;  grain  of 
all  sorts,  lumber,  salt,  provisions,  fish,  sugar,  and  rum. 

Grain  is  naturally  the  first  and  principal  object  of  the  culture  of 
all  new  colonies.  By  allowing  them  a  very  extensive  market  for 
it,  the  law  encourages  them  to  extend  this  culture  much  beyond 
the  consumption  of  a  thinly  inhabited  country,  and  thus  to  provide 
beforehand  an  ample  subsistence  for  a  continually  increasing 
population. 

In  a  country  quite  covered  with  wood,  where  timber  conse- 
quently is  of  little  or  no  value,  the  expense  of  clearing  the  ground 
is  the  principal  obstacle  to  improvement.  By  allowing  the  colo- 
nies a  very  extensive  market  for  their  lumber  the  law  endeavors  to 
facilitate  improvement  by  raising  the  price  of  a  commodity  which 
would  otherwise  be  of  little  value,  and  thereby  enabling  them  to 
make  some  profit  of  what  would  otherwise  be  mere  expense. 

In  a  country  neither  half-peopled  nor  half-cultivated,  cattle 
naturallv  multiply  beyond  the  consumption  of  the  inhabitants,  and 
are  often,  upon  that  account,  of  little  or  no  value.  But  it  is  neces- 


1 8  SELECTIONS. 

sary,  it  has  already  been  shown,  that  the  price  of  cattle  should 
bear  a  certain  proportion  to  that  of  corn  before  the  greater  part  of 
the  lands  of  any  country  can  be  improved.  By  allowing  to 
American  cattle,  in  all  shapes,  dead  and  alive  a  very  extensive 
market,  the  law  endeavors  to  raise  the  value  of  a  commodity  of 
which  the  high  price  is  so  very  essential  to  improvement.  The 
good  effects  of  this  liberty,  however,  must  be  somewhat  dimin- 
ished by  the  4th  of  George  III.,  c.  15,  which  puts  hides  and  skins 
among  the  enumerated  commodities,  and  thereby  tends  to  reduce 
the  valuation  of  American  cattle. 

To  increase  the  shipping  and  naval  power  of  Great  Britain, 
by  the  extension  of  the  fisheries  of  our  colonies,  is  an  object 
which  the  legislature  seems  to  have  had  almost  constantly  in 
view.  Those  fisheries,  upon  this  account,  have  had  all  the  en- 
couragement which  freedom  can  give  them,  and  they  have  flour- 
ished accordingly.  The  New  England  fishery  in  particular  was, 
before  the  late  disturbances,  one  of  the  most  important,  perhaps, 
in  the  world.  The  whale-fishery,  which,  notwithstanding  an 
extravagant  bounty,  is  in  Great  Britain  carried  on  to  so  little  pui'- 
pose,  that,  in  the  opinion  of  many  people  (which  I  do  not,  how- 
ever, pretend  to  warrant)  the  whole  produce  does  not  much 
exceed  the  value  of  the  bounties  which  are  annually  paid  for  it, 
is  in  New  England  carried  on  without  any  bounty  to  a  very  great 
extent.  Fish  is  one  of  the  principal  articles  with  which  the  North 
Americans  trade  to  Spain,  Portugal,  and  the  Mediterranean. 

Sugar  was  originally  an  enumerated  commodity  which  could 
be  exported  only  to  Great  Britain.  But  in  173*1  upon  a  repre- 
sentation of  the  sugar-planters,  its  exportation  was  permitted  to 
all  parts  of  the  world.  The  restrictions,  however,  with  which 
this  liberty  was  granted,  joined  to  the  high  price  of  sugar  in  Great 
Britain,  have  rendered  it,  in  a  great  measure,  ineffectual.  Great 
Britain  and  her  colonies  still  continue  to  be  almost  the  sole 
market  for  all  the  sugar  produced  in  the  British  plantations. 
Their  consumption  increases  so  fast,  that,  though  in  consequence 
of  the  increasing  improvement  of  Jamaica,  as  well  as  of  the 
Ceded  Islands,  the  importation  of  sugar  has  increased  very  greatly 
within  these  twenty  years,  the  exportation  to  foreign  countries  is 
said  to  be  not  much  greater  than  before. 

Rum  is  a  very  important  article  in  the  trade  which  the  Ameri- 
cans carry  on  to  the  coast  of  Africa,  from  which  they  bring  back 
negro  slaves  in  return. 


COLONIAL   POLICY   OF   EUROPE.  19 

If  the  whole  surplus  produce  of  America  in  grain  of  all  sorts, 
in  salt  provisions,  and  in  fish,  had  been  put  into  the  enumeration, 
and  thereby  forced  into  the  market  of  Great  Britain,  it  would 
have  interfered  too  much  with  the  produce  of  the  industry  of  our 
own  people.  It  was  probably  not  so  much  from  any  regard  to 
the  interest  of  America,  as  from  a  jealousy  of  this  interference, 
that  those  important  commodities  have  not  only  been  kept  out  of 
the  enumeration,  but  that  the  importation  into  Great  Britain  of 
all  grain,  except  rice,  and  of  all  salt  provisions,  has,  in  the  ordi- 
nary state  of  the  law,  been  prohibited. 

The  non-enumerated  commodities  could  originally  be  exported 
to  all  parts  of  the  world.  Lumber  and  rice,  having  been  once 
put  into  the  enumeration,  when  they  were  afterwards  taken  out 
of  it,  were  confined,  as  to  the  European  market,  to  the  countries 
that  lie  south  of  Cape  Finisterre.  By  the  6th  of  George  III.,  c. 
52,  all  non-enumerated  commodities  were  subjected  to  the  like 
restriction.  The  parts  of  Europe  which  lie  south  of  Cape  Fin- 
isterre, are  not  manufacturing  countries,  and  we  were  less  jealous 
of  the  colony  ships  carrying  home  from  them  any  manufactures 
which  could  interfere  with  our  own. 

The  enumerated  commodities  are  of  two  sorts  :  first,  such  as 
are  either  the  peculiar  produce  of  America,  or  as  cannot  be  pro- 
duced, or  at  least  are  not  produced,  in  the  mother  country.  Of 
this  kind  are,  molasses,  coffee,  cocoanuts,  tobacco,  pimento, 
ginger,  whale-fins,  raw  silk,  cotton-wool,  beaver,  and  other  peltry 
of  America,  indigo,  fustic,  and  other  dyeing  woods :  secondly, 
such  as  are  not  the  peculiar  produce  of  America,  but  which  are 
and  may  be  produced  in  the  mother  country,  though  not  in  such 
quantities  as  to  supply  the  greater  part  of  her  demand,  which  is 
principally  supplied  from  foreign  countries.  Of  this  kind  are  all 
naval  stores,  masts,  yards,  and  bowsprits,  tar,  pitch,  and  turpen- 
tjne,  pig  and  bar  iron,  copper  ore,  hides  and  skins,  pot  and  pearl 
ashes.  The  largest  importation  of  commodities  of  the  first  kind 
could  not  discourage  the  growth  or  interfere  with  the  sale  of  any 
part  of  the  produce  of  the  mother  country.  By  confining  them 
to  the  home  market,  our  merchants,  it  was  expected,  would  not 
only  be  enabled  to  buy  them  cheaper  in  the  Plantations,  and  con- 
sequently to  sell  them  with  a  better  profit  at  home,  but  to  estab- 
lish between  the  Plantations  and  foreign  countries  an  advantageous 
carrying  trade,  of  which  Great  Britain  was  necessarilv  to  be  the 
centre  or  emporium,  as  the  European  country  into  which  those 


20  SELECTIONS. 

commodities  were  first  to  be  imported.  The  importation  of  com- 
modities of  the  second  kind  might  be  so  managed  too,  it  was  sup- 
posed, as  to  interfere,  not  with  the  sale  of  those  of  the  same  kind 
which  were  produced  at  home,  but  with  that  of  those  which  were 
imported  from  foreign  countries ;  because,  by  means  of  proper 
duties,  they  might  be  rendered  always  somewhat  dearer  than  the 
former,  and  yet  a  good  deal  cheaper  than  the  latter.  By  confin- 
ing such  commodities  to  the  home  market,  therefore,  it  was  pro- 
posed to  discourage  the  produce,  not  of  Great  Britain,  but  of 
some  foreign  countries  with  which  the  balance  of  trade  was  be- 
lieved to  be  unfavorable  to  Great  Britain. 

The  prohibition  of  exporting  from  the  colonies,  to  any 
other  country  but  Great  Britain,  masts,  yards,  and  bowsprits, 
tar,  pitch,  and  turpentine,  naturally  tended  to  lower  the  price  of 
timber  in  the  colonies,  and  consequently  to  increase  the  expense 
of  clearing  their  lands,  the  principal  obstacle  to  their  improve- 
ment. But  about  the  beginning  of  the  present  century,  in  1703, 
the  pitch  and  tar  company  of  Sweden  endeavored  to  raise  the  price 
of  their  commodities  to  Great  Britain,  by  prohibiting  their  expor- 
tation, except  in  their  own  ships,  at  their  own  price,  and  in  such 
quantities  as  they  thought  proper.  In  order  to  counteract  this 
notable  piece  of  mercantile  policy,  and  to  render  herself  as  much 
as  possible  independent,  not  only  of  Sweden,  but  of  all  the  other 
northern  powers,  Great  Britain  gave  a  bounty  upon  the  importa- 
tion of  naval  stores  from  America,  and  the  effect  of  this  bounty 
was  to  raise  the  price  of  timber  in  America,  much  more  than  the 
confinement  to  the  home  market  could  lower  it ;  and,  as  both 
regulations  were  enacted  at  the  same  time,  their  joint  effect  was 
rather  to  encourage  than  to  discourage  the  clearing  of  land  in 
America. 

Though  pig  and  bar  iron  too  have  been  put  among  the  enu- 
merated commodities,  yet  as,  when  imported  from  America, 
they  are  exempted  from  considerable  duties  to  which  they  are 
subject  when  imported  from  any  other  country,  the  one  part  of 
the  regulation  contributes  more  to  encourage  the  erection  of  fur- 
naces in  America,  than  the  other  to  discourage  it.  There  is  no 
manufacture  which  occasions  so  great  a  consumption  of  wood  as 
a  furnace,  or  which  can  contribute  so  much  to  the  clearing  of  a 
country  overgrown  with  it. 

The  tendency  of  some  of  these  regulations  to  raise  the  value  of 
timber  in  America,  and  thereby  to  facilitate  the  clearing  of  the  land, 


COLONIAL    POLICY    OF   EUROPE.  21 

was  neither,  perhaps,  intended  nor  understood  by  the  legislature. 
Though  their  beneficial  effects,  however,  have  been  in  this 
respect  accidental,  they  have  not  upon  that  account  been  less 
real. 

The  most  perfect  freedom  of  trade  is  permitted  between  the 
British  colonies  of  America  and  the  West  Indies,  both  in  the  enu- 
merated and  in  the  non-enumerated  commodities.  Those  colonies 
are  now  become  so  populous  and  thriving,  that  each  of  them  finds 
in  some  of  the  others  a  great  and  extensive  market  for  every  part 
of  its  produce.  All  of  them  taken  together,  they  make  a  great 
internal  market  for  the  produce  of  one  another. 

The  liberality  of  England,  however,  towards  the  trade  of  her 
colonies  has  been  confined  chiefly  to  what  concerns  the  market 
for  their  produce,  either  in  its  rude  state,  or  in  what  mav  be 
called  the  very  first  stage  of  manufacture.  The  more  advanced 
or  more  refined  manufactures  even  of  the  colony  produce,  the 
merchants  and  manufacturers  of  Great  Britain  choose  to  reserve 
to  themselves,  and  have  prevailed  upon  the  legislature  to  prevent 
their  establishment  in  the  colonies,  sometimes  by  high  duties, 
and  sometimes  by  absolute  prohibitions. 

While,  for  example,  Muscovado  sugars  from  the  British  plan- 
tations, pay  upon  importation  onlv  6s.  A^d.  the  hundred  weight ; 
white  sugars  pay  £t,  15.  id.  ;  and  refined,  either  double  or  single, 
in  loaves  £4,  2s.  $d.  ^.  When  those  high  duties  were  imposed, 
Great  Britain  was  the  sole,  and  she  still  continues  to  be  the  prin- 
cipal market  to  which  the  sugars  of  the  British  colonies  could  be 
exported.  They  amounted,  therefore,  to  a  prohibition,  at  first  of 
claying  or  refining  sugar  for  any  foreign  market,  and  at  present 
of  claying  or  refining  it  for  the  market,  which  takes  off,  perhaps, 
more  than  nine-tenths  of  the  whole  produce.  The  manufacture 
of  claving  or  refining  sugar  accordingly,  though  it  has  flourished 
in  all  the  sugar  colonies  of  France,  has  been  little  cultivated  in 
any  of  these  of  England,  except  for  the  market  of  the  colonies 
themselves.  While  Grenada  was  in  the  hands  of  the  French 
there  was  a  refinery  of  sugar,  by  claving  at  least,  upon  almost 
every  plantation.  Since  it  fell  into  those  of  the  English,  almost 
all  works  of*  this  kind  have  been  given  up,  and  there  are  at 
present,  October,  1773,  I  am  assured,  not  above  two  or  three 
remaining  in  the  island.  At  present,  however,  by  an  indulgence 
of  the  custom-house,  clayed  or  refined  sugar,  if  reduced  from 
loaves  into  powder,  is  commonly  imported  as  Muscovado. 


22  SELECTIONS. 

While  Great  Britain  encourages  in  America  the  manu- 
factures of  pig  and  bar  iron,  by  exempting  them  from  duties 
to  which  the  like  commodities  are  subjected  when  imported 
from  any  other  country,  she  imposes  an  absolute  prohibition 
upon  the  erection  of  steel  furnaces  and  slit-mills  in  any  of 
her  American  plantations.  She  will  not  suffer  her  colonists 
to  work  in  those  more  refined  manufactures  even  for  their 
own  consumption  ;  but  insists  upon  their  purchasing  of  her  mer- 
chants and  manufacturers  all  goods  of  this  kind  which  they  have 
occasion  for. 

She  prohibits  the  exportation  from  one  province  to  another  by 
water,  and  even  the  carriage  by  land  upon  horseback  or  in  a 
cart,  of  hats,  of  wools  and  woollen  goods,  of  the  produce  of 
America  ;  a  regulation  which  effectually  prevents  the  establish- 
ment of  any  manufacture  of  such  commodities  for  distant  sale,  and 
confines  the  industry  of  her  colonists  in  this  way  to  such  coarse 
and  household  manufactures,  as  a  private  family  commonly  makes 
for  its  own  use,  or  for  that  of  some  of  its  neighbors  in  the  same 
province. 

To  prohibit  a  great  people,  however,  from  making  all  that  they 
can  of  every  part  of  their  own  produce,  or  from  employing  their 
stock  and  industry  in  the  way  that  they  judge  most  advantageous 
to  themselves,  is  a  manifest  violation  of  the  most  sacred  rights  of 
mankind.  Unjust,  however,  as  such  prohibitions  may  be,  they 
have  not  hitherto  been  very  hurtful  to  the  colonies.  Land  is  still 
so  cheap,  and,  consequently,  labor  so  dear  among  them,  that  they 
can  import  from  the  mother  country  almost  all  the  more  refined 
or  more  advanced  manufactures  cheaper  than  they  could  make 
them  for  themselves.  Though  they  had  not,  therefore,  been  pro- 
hibited from  establishing  such  manufactures,  yet  in  their  present 
state  of  improvement,  a  regard  to  their  own  interest  would, 
probably,  have  prevented  them  from  doing  so.  In  their  present 
state  of  improvement  those  prohibitions,  perhaps,  without  cramp- 
ing their  industry,  or  restraining  it  from  any  employment  to 
which  it  would  have  gone  of  its  own  accord,  are  only  impertinent 
badges  of  slavery  imposed  upon  them,  without  any  sufficient  rea- 
son, by  the  groundless  jealousy  of  the  merchants  And.  manufac- 
turers of  the  mother  country.  In  a  more  advanced  state  they 
might  be  really  oppressive  and  insupportable. 

Great  Britain  too,  as  she  confines  to  her  own  market  some  of 
the  most  important  productions  of  the  colonies,  so  in  compensa- 


COLONIAL   POLICY   OF   EUROPE.  23 

tion  she  gives  to  some  of  them  an  advantage  in  that  market ; 
sometimes  by  imposing  higher  duties  upon  the  like  productions 
when  imported  from  other  countries,  and  sometimes  by  giving 
bounties  upon  their  importation  from  the  colonies.  In  the  first 
wav  she  gives  an  advantage  in  the  home  market  to  the  sugar,  to- 
bacco, and  iron  of  her  own  colonies,  and  in  the  second  to  their 
raw  silk,  to  their  hemp  and  flax,  to  their  indigo,  to  their  naval 
stores,  and  to  their  building-timber.  This  second  way  of  en- 
couraging the  colony  produce  by  bounties  upon  importation,  is, 
so  far  as  I  have  been  able  to  learn,  peculiar  to  Great  Britain. 
The  first  is  not.  Portugal  does  not  content  herself  with  imposing 
higher  duties  upon  the  importation  of  tobacco  from  any  other 
country,  but  prohibits  it  under  the  severest  penalties. 

With  regard  to  the  importation  of  goods  from  Europe,  England 
has  likewise  dealt  more  liberally  with  her  colonies  than  any  other 
nation. 

Great  Britain  allows  a  part,  almost  alwavs  the  half,  generally 
a  larger  portion,  and  sometimes  the  whole  of  the  duty  which  is 
paid  upon  the  importation  of  foreign  goods,  to  be  drawn  back 
upon  their  exportation  to  anv  foreign  country.  No  independent 
foreign  country,  it  was  easy  to  foresee,  would  receive  them  if 
they  came  to  it  loaded  with  the  heavy  duties  to  which  almost  all 
foreign  goods  are  subjected  on  their  importation  into  Great 
Britain.  Unless,  therefore,  some  part  of  those  duties  was  drawn 
back  upon  exportation,  there  was  an  end  of  the  carrying  trade  ; 
a  trade  so  much  favored  by  the  mercantile  system. 

Our  colonies,  however,  are  by  no  means  independent  foreign 
countries  ;  and  Great  Britain,  having  assumed  to  herself  the  ex- 
clusive right  of  supplying  them  with  all  goods  from  Europe, 
might  have  forced  them  (in  the  same  manner  as  other  countries 
have  done  their  colonies)  to  receive  such  goods  loaded  with  all 
the  same  duties  which  they  paid  in  the  mother  country.  But,  on 
the  contrary,  till  1763,  the  same  drawbacks  were  paid  upon  the 
exportation  of  the  greater  part  of  foreign  goods  to  our  colonies  as  to 
any  independent  foreign  country.  In  1763,  indeed,  by  the  4th 
of  George  III.,  c.  15,  this  indulgence,  was  a  good  deal  abated, 
and  it  was  enacted,  "  That  no  part  of  the  duty  called  the 
old  subsidy  should  be  drawn  back  for  any  goods  of  the  growth, 
production,  or  manufacture  of  Europe  or  the  East  Indies,  which 
should  be  exported  from  this  kingdom  to  any  British  colony  or 
plantation  in  America  ;  wines,  white  calicoes  and.  muslins  ex- 


24  SELECTIONS. 

ceptecl."  Before  this  law,  many  different  sorts  of  foreign  goods 
might  have  been  bought  cheaper  in  the  plantations  than  in  the 
mother  country  ;  find  some  may  still. 

Of  the  greater  part  of  the  regulations  concerning  the  colony 
trade,  the  merchants  who  carry  it  on,  it  must  be  observed,  have 
been  the  principal  advisers.  We  must  not  wonder,  therefore,  if, 
in  the  greater  part  of  them,  their  interest  has  been  more  considered 
than  either  that  of  the  colonies  or  that  of  the  mother  country.  In 
their  exclusive  privilege  of  supplying  the  colonies  with  all  the 
goods  which  they  wanted  from  Europe,  and  of  purchasing  all 
such  parts  of  their  surplus  produce  as  could  not  interfere  with  any 
of  the  trades  which  they  themselves  carried  on  at  home,  the 
interest  of  the  colonies  was  sacrificed  to  the  interest  of  those  mer- 
chants. In  allowing  the  same  drawbacks  upon  the  re-exporta- 
tion of  the  greater  part  of  European  and  East  India  goods  to  the 
colonies,  as  upon  their  re-exportation  to  any  independent  country, 
the  interest  of  the  mother  country  was  sacrificed  to  it,  even  accord- 
ing to  the  mercantile  ideas  of  that  interest.  It  was  for  the  interest 
of  the  merchants  to  pay  as  little  as  possible  for  the  foreign  goods 
which  they  sent  to  the  colonies,  and  consequentlv,  to  get  back  as 
much  as  possible  of  the  duties  which  they  advanced  upon  their 
importation  into  Great  Britain.  They  might  thereby  be  enabled 
to  sell  in  the  colonies,  either  the  same  quantity  of  goods  with  a 
greater  profit,  or  a  greater  quantity  with  the  same  profit,  and, 
consequently,  to  gain  something  either  in  the  one  way  or  the  other. 
It  was,  likewise,  for  the  interest  of  the  colonies  to  get  all  such 
goods  as  cheap  and  in  as  great  abundance  as  possible.  But  this 
might  not  always  be  for  the  interest  of  the  mother  country.  She 
might  frequently  suffer  both  in  her  revenue,  by  giving  back  a 
great  part  of  the  duties  which  had  been  paid  upon  the  importa- 
tion of  such  goods  ;  and  in  her  manufactures,  by  being  undersold 
in  the  colony  market,  in  consequence  of  the  easy  terms  upon 
which  foreign  manufactures  could  be  carried  thither  by  means  of 
those  drawbacks.  The  progress  of  the  linen  manufacture  of 
Great  Britain,  it  is  commonly  said,  has  been  a  good  deal  re- 
tarded by  the  drawbacks  upon  the  re-exportation  of  German  linen 
to  the  American  colonies. 

But  though  the  policy  of  Great  Britain  with  regard  to  the 
trade  of  her  colonies  has  been  dictated  by  the  same  mercantile 
spirit  as  that  of  other  nations,  it  has,  however,  upon  the  whole, 
been  less  illiberal  and  oppressive  than  that  of  any  of  them. 


COLONIAL   POLICY    OF   EUROPE.  25 

In  everything,  except  their  foreign  trade,  the  liberty  of  the 
English  colonists  to  manage  their  own  affairs  their  own  way  is 
complete.  It  is  in  every  respect  equal  to  that  of  their  fellow- 
citizens  at  home,  and  is  secured  in  the  same  manner,  by  an  as- 
sembly of  the  representatives  of  the  people,  who  claim  the  sole 
right  of  imposing  taxes  for  the  support  of  the  colony  government. 
The  authority  of  this  assembly  overawes  the  executive  power, 
and  neither  the  meanest  nor  the  most  obnoxious  colonist,  as  long 
as  he  obeys  the  law,  has  anything  to  fear  from  the  resentment, 
either  of  the  governor,  or  of  any  other  civil  or  military  officer  in 
the  province.  The  colony  assemblies,  though,  like  the  house  of 
commons  in  England,  they  are  not  always  a  very  equal  repre- 
sentation of  the  people,  yet  they  approach  more  nearly  to  that 
character ;  and  as  the  executive  power  either  has  not  the  means 
to  corrupt  them,  or,  on  account  of  the  support  which  it  receives 
from  the  mother  country,  is  not  under  the  necessity  of  doing  so, 
they  are  perhaps  in  general  more  influenced  by  the  inclinations 
of  their  constituents.  The  councils,  which,  in  the  colony  legis- 
latures, correspond  to  the  house  of  lords  in  Great  Britain,  are  not 
composed  of  an  hereditary  nobility.  In  some  of  the  colonies,  as 
in  three  of  the  governments  of  New  England,  those  councils  are 
not  appointed  by  the  king,  but  chosen  by  the  representatives  of 
the  people.  In  none  of  the  English  colonies  is  there  any  heredi- 
tary nobility.  In  all  of  them,  indeed,  as  in  all  other  free  coun- 
tries, the  descendant  of  an  old  colony  family  is  more  respected 
than  an  upstart  of  equal  merit  and  fortune  :  but  he  is  only  more 
respected,  and  he  has  no  privileges  by  which  he  can  be  trouble- 
some to  his  neighbors.  Before  the  commencement  of  the 
present  disturbances,  the  colony  assemblies  had  not  only  the  legis- 
lative, but  a  part  of  the  executive  power.  In  Connecticut  and 
Rhode  Island  they  elected  the  governor.  In  the  other  colonies 
they  appointed  the  revenue  officers  who  collected  the  taxes  im- 
posed by  those  respective  assemblies,  to  whom  those  officers  were 
immediately  responsible.  There  is  more  equality,  therefore, 
among  the  English  colonists  than  among  the  inhabitants  of  the 
mother  country.  Their  manners  are  more  republican,  and  their 
governments,  those  of  three  of  the  provinces  of  New  England  in 
particular,  have  hitherto  been  more  republican  too. 

The  absolute  governments  of  Spain,  Portugal,  and  France,  on 
the  contrary,  take  place  in  their  colonies;  and  the  discretionary 
powers  which  such  governments  commonly  delegate  to  all  their 


26  SELECTIONS. 

inferior  officers  are,  on  account  of  the  great  distance,  naturally 
exercised  there  with  more  than  ordinary  violence.  Under  all 
absolute  governments  there  is  more  liberty  in  the  capital  than  in 
any  other  part  of  the  country.  The  sovereign  himself  can  never 
have  either  interest  or  inclination  to  pervert  the  order  of  justice, 
or  to  oppress  the  great  body  of  the  people.  In  the  capital  his 
presence  overawes  more  or  less  all  his  inferior  officers,  who  in 
the  remoter  provinces,  from  whence  the  complaints  of  the  people 
are  less  likely  to  reach  him,  can  exercise  their  tyranny  with  much 
more  safety.  But  the  European  colonies  in  America  are  more 
remote  than  the  most  distant  provinces  of  the  greatest  empires 
which  had  ever  been  known  before.  The  government  of  the 
English  colonies  is  perhaps  the  only  one  which,  since  the  world 
began,  could  give  perfect  security  to  the  inhabitants  of  so  very 
distant  a  province.  The  administration  of  the  French  colonies, 
however,  has  always  been  conducted  with  more  gentleness  and 
moderation  than  that  of  the  Spanish  and  Portuguese.  This 
superiority  of  conduct  is  suitable  both  to  the  character  of  the 
French  nation,  and  to  what  forms  the  character  of  every  nation, 
the  nature  of  their  government,  which,  though  arbitrary  and 
violent  in  comparison  with  that  of  Great  Britain,  is  legal  and 
free  in  comparison  with  those  of  Spain  and  Portugal. 

It  is  in  the  progress  of  the  North  American  colonies,  however, 
that  the  superiority  of  the  English  policy  chiefly  appears.  The 
progress  of  the  sugar  colonies  of  France  has  been  at  least  equal, 
perhaps  superior,  to  that  of  the  greater  part  of  those  of  England  ; 
and  yet  the  sugar  colonies  of  England  enjoy  a  free  government 
nearly  of  the  same  kind  with  that  which  takes  place  in  her  colo- 
nies of  North  America.  But  the  sugar  colonies  of  France  are  not 
discouraged,  like  those  of  England,  from  refining  their  own 
sugar ;  and,  what  is  of  still  greater  importance,  the  genius  of 
their  government  naturally  introduces  a  better  management  of 
their  negro  slaves. 

In  all  European  colonies  the  culture  of  the  sugar-cane  is  carried 
on  by  negro  slaves.  The  constitution  of  those  who  have  been 
born  in  the  temperate  climate  of  Europe  could  not,  it  is  sup- 
posed, support  the  labor  of  digging  the  ground  under  the  burning 
sun  of  the  West  Indies;  and  the  culture  of  the  sugar-cane,  as  it 
is  managed  at  present,  is  all  hand  labor,  though,  in  the  opinion 
of  many,  the  drill  plough  might  be  introduced  into  it  with  great 
advantage.  But,  as  the  profit  and  success  of  the  cultivation 


COLONIAL  POLICY  OF  EUROPE.  2/ 

which  is  carried  on  by  means  of  cattle,  depend  very  much  upon 
the  good  management  of  those  cattle  ;  so  the  profit  and  success  of 
that  which  is  carried  on  by  slaves,  must  depend  equally  upon  the 
good  management  of  those  slaves  ;  and  in  the  good  management 
of  their  slaves  the  French  planters,  I  think  it  is  generally  allowed, 
are  superior  to  the  English.  The  law,  so  far  as  it  gives  some 
\veak  m'otection  to  the  slave  against  the  violence  of  his  master,  is 
likely  to  be  better  executed  in  a  colony  where  the  government  is 
in  a  great  measure  arbitrary,  than  in  one  where  it  is  altogether 
free.  In  every  country  where  the  unfortunate  law  of  slavery  is 
established,  the  magistrate,  when  he  protects  the  slave,  inter- 
meddles in  some  measure  in  the  management  of  the  private 
property  of  the  master;  and,  in  a  free  country,  where  the  master 
is  perhaps  either  a  member  of  the  colony  assembly,  or  an  elector 
of  such  a  member,  he  dare  not  do  this  but  with  the  greatest  cau- 
tion and  circumspection.  The  respect  which  he  is  obliged  to 
pay  to  the  master  renders  it  more  difficult  for  him  to  protect  the 
slave.  But  in  a  country  where  the  government  is  in  a  great  meas- 
ure arbitrary,  where  it  is  usual  for  the  magistrate  to  intermeddle 
even  in  the  management  of  the  private  property  of  individuals,  and 
to  send  them,  perhaps,  a  lettre  de  cachet  if  they  do  not  manage  it 
according  to  his  liking,  it  is  much  easier  for  him  to  give  some 
protection  to  the  slave  ;  and  common  humanity  naturally  disposes 
him  to  do  so.  The  protection  of  the  magistrate  renders  the  slave 
less  contemptible  in  the  eyes  of  his  master,  who  is  thereby 
induced  to  consider  him  with  more  regard,  and  to  treat  him  with 
more  gentleness.  Gentle  usage  renders  the  slave  not  only  more 
faithful,  but  more  intelligent,  and  therefore,  upon  a  double 
account,  more  useful.  He  approaches  more  to  the  condition 
of  a  free  servant,  and  may  possess  some  degree  of  integrity  and 
attachment  to  his  master's  interest,  —  virtues  which  frequently 
belong  to  free  servants,  but  which  never  can  belong  to  a  slave, 
who  is  treated  as  slaves  commonly  are  in  countries  where  the 
master  is  perfectly  free  and  secure. 

That  the  condition  of  a  slave  is  better  under  an  arbitrary  than 
under  a  free  government,  is,  I  believe,  supported  by  the  history 
of  all  ages  and  nations.  In  the  Roman  history  the  first  time  we 
read  of  the  magistrate  interposing  to  protect  the  slave  from  the 
violence  of  his  master  is  under  the  emperors.  When  Vedius 
Pollio,  in  the  Augustus,  ordered  one  of  his  slaves,  who  had  com- 
mitted a  slight  fault,  to  be  cut  into  pieces,  and  thrown  into  his 


28  SELECTIONS. 

fish-pond  in  order  to  feed  his  fishes,  the  emperor  commanded  him, 
with  indignation,  to  emancipate  immediately,  not  only  that  slave 
but  all  the  others  that  belonged  to  him.  Under  the  republic  no 
magistrate  could  have  had  authority  enough  to  protect  the  slave, 
much  less  to  punish  the  master. 

The  stock,  it  is  to  be  observed,  which  has  improved  the  sugar 
colonies  of  France,  particularly  the  great  colony  of  St.  Domingo, 
has  been  raised  almost  entirely  from  the  gradual  improvement 
and  cultivation  of  those  colonies.  It  has  been  almost  altogether 
the  produce  of  the  soil  and  of  the  industry  of  the  colonists,  or, 
what  comes  to  the  same  thing,  the  price  of  that  produce  grad- 
ually accumulated  by  good  management,  and  employed  in  raising 
a  still  greater  produce.  But  the  stock  which  has  improved  and 
cultivated  the  sugar  colonies  of  England  has,  a  great  part  of  it, 
been  sent  out  from  England,  and  has  by  no  means  been  alto- 
gether the  produce  of  the  soil  and  industry  of  the  colonists.  The 
prosperity  of  the  English  sugar  colonies  has  been,  in  a  great 
measure,  owing  to  the  great  riches  of  England,  of  which  a  part 
has  overflowed,  if  one  may  say  so,  upon  those  colonies.  But 
the  prosperity  of  the  sugar  colonies  of  France  has  been  entirely 
owing  to  the  good  conduct  of  the  colonists,  which  must  there- 
fore have  had  some  superiority  over  that  of  the  English  ;  and 
this  superiority  has  been  remarked  in  nothing  so  much  as  in  the 
good  management  of  their  slaves. 

Such  have  been  the  general  outlines  of  the  policy  of  the  differ- 
ent European  nations  with  regard  to  their  colonies. 

The  policy  of  Europe,  therefore,  has  very  little  to  boast  of, 
either  in  the  original  establishment,  dr.  so  far  as  concerns  their 
internal  government,  in  the  subsequent  prosperity  of  the  colonies 
of  America. 

Folly  and  injustice  seem  to  have  been  the  principles  which 
presided  over  and  directed  the  first  project  of  establishing  those 
colonies ;  the  folly  of  hunting  after  gold  and  silver  mines,  and 
the  injustice  of  coveting  the  possession  of  a  country  whose  harm- 
less natives,  far  from  having  ever  injured  the  people  of  Europe, 
had  received  the  first  adventurers  with  every  mark  of  kindness 
and  hospitality. 

The  adventurers,  indeed,  who  formed  some  of  the  later  estab- 
lishments, joined,  to  the  chimerical  project  of  finding  gold  and  sil- 
ver mines,  other  motives  more  reasonable  and  more  laudable  ;  but 
even  these  motives  do  very  little  honor  to  the  policy  of  Europe. 


COLONIAL    POLICY   OF   EUROPE.  29 

The  English  Puritans,  restrained  at  home,  fled  for  freedom  to 
America,  and  established  there  the  four  governments  of  New 
England.  The  English  Catholics,  treated  with  much .  greater 
injustice,  established  that  of  Maryland  ;  the  Quakers,  that  of 
Pennsylvania.  The  Portuguese  Jews,  persecuted  by  the  Inquisi- 
tion, stripped  of  their  fortunes,  and  banished  to  Brazil,  introduced, 
by  their  example,  some  sort  of  order  and  industry  among  the 
transported  felons  and  strumpets,  by  whom  that  colony  was  origi- 
nally peopled,  and  taught  them  the  culture  of  the  sugar-cane. 
Upon  all  these  different  occasions,  it  was,  not  the  wisdom  and 
policy,  but  the  disorder  and  injustice,  of  the  European  govern- 
ments, which  peopled  and  cultivated  America. 

In  effectuating  some  of  the  most  important  of  these  establish- 
ments, the  different  governments  of  Europe  had  as  little  merit  as 
in  projecting  them.  The  conquest  of  Mexico  was  the  project, 
not  of  the  council  of  Spain,  but  of  a  governor  of  Cuba  ;  and  it  was 
effectuated  by  the  spirit  of  the  bold  adventurer  to  whom  it  was 
entrusted,  in  spite  of  everything  which  that  governor,  who  soon 
repented  of  having  trusted  such  a  person,  could  do  to  thwart  it. 
The  conquerors  of  Chili  and  Pei'u,  and  of  almost  all  the  other 
Spanish  settlements  upon  the  continent  of  America,  carried  out 
with  them  no  other  public  encouragement,  but  a  general  per- 
mission to  make  settlements  and  conquests  in  the  name  of  the 
king  of  Spain.  Those  adventures  were  all  at  the  private  risk  and 
expense  of  the  adventurers.  The  government  of  Spain  con- 
tributed scarce  anything  to  any  of  them.  That  of  England  con- 
tributed as  little  towards  effectuating  the  establishment  of  some 
of  its  most  important  colonies  in  North  America. 

When  those  establishments  were  effectuated,  and  had  become 
so  considerable  as  to  attract  the  attention  of  the  mother  country, 
the  first  regulations  which  she  made  with  regard  to  them  had 
always  in  view  to  secure  to  herself  the  monopoly  of  their  com- 
merce ;  to  confine  their  market,  and  to  enlarge  her  own  at  their 
expense,  and,  consequently,  rather  to  damp  and  discourage,  than 
to  quicken  and  forward,  the  course  of  their  prosperity.  In  the 
different  ways  in  which  this  monopoly  has  been  exercised,  con- 
sists one  of  the  most  essential  differences  in  the  policy  of  the 
different  European  nations  with  regard  to  their  colonies.  The 
best  of  them  all,  that  of  England,  is  only  somewhat  less  illiberal 
and  oppressive  than  that  of  any  of  the  rest. 

In  what  way,  therefore,  has  the  policy  of  Europe  contributed 


30  SELECTIONS. 

either  to  the  first  establishment,  or  to  the  present  grandeur  of  the 
colonies  of  America?  In  one  way,  and  in  one  way  only,  it  has 
contributed  a  good  deal.  Magna  virum  Mater  I  It  bred  and 
formed  the  men  who  were  capable  of  achieving  such  great 
actions,  and  of  laying  the  foundation  of  so  great  an  empire ;  and 
there  is  no  other  quarter  of  the  world  of  which  the  policy  is 
capable  of  forming,  or  has  ever  actually  and  in  fact  formed,  such 
men.  The  colonies  owe  to  the  policy  of  Europe  the  education 
and  great  views  of  their  active  and  enterprising  founders  ;  and 
some  of  the  greatest  and  most  important  of  them,  so  far  as  con- 
cerns their  internal  government,  owe  to  it  scarce  anything  else. 


THE   GREAT   INVENTIONS.  31 

III. 

THE    GREAT   INVENTIONS. 
FROM  WALPOLE'S  HISTORY  OF  ENGLAND,  VOL.  I.,  PP.  50-76. 

The  manufacturing  industries  of  the  country  had  never  previ- 
ously experienced  so  marvellous  a  development.  The  hum  of 
the  workshop  was  heard  in  places  which  had  previously  only 
been  disturbed  by  the  whirr  of  the  grouse ;  and  new  forces, 
undreamed  of  a  century  before,  were  employed  to  assist  the 
progress  of  production.  The  trade  of  the  United  Kingdom 
acquired  an  importance  which  it  had  never  previously  enjoyed, 
and  the  manufacturing  classes  obtained  an  influence  which  they 
had  never  before  known.  The  land-owners  wrere  slowly  losing 
the  monopoly  of  power  which  they  had  enjoyed  for  centuries. 
Traders  and  manufacturers  were  daily  obtaining  fresh  wealth  and 
influence.  A  new  England  was  supplanting  the  old  country  ; 
and  agriculture,  the  sole  business  of  our  forefathers,  was  gradu- 
ally becoming  of  less  importance  than  trade.  In  i793i  the  first 
year  of  the  war,  the  official  value  of  all  the  imports  into  Britain 
was  less  than  £20,000,000.  In  1815,  the  year  of  Waterloo,  it 
exceeded  £31,000,000.  In  1792,  the  official  value  of  British  and 
Irish  exports  was  only  £18,000,000  :  it  rose  in  1815  to  £41,000,000. 
The  official  values,  however,  give  only  a  very  imperfect  idea  of 
the  extent  of  our  export  trade.  They  are  based  on  prices  fixed 
so  far  back  as  1696,  and  afford,  therefore,  an  inaccurate  test  of 
the  extent  of  our  trade.  No  attempt  was  made  to  ascertain  the 
declared  or  real  value  of  the  exports  till  the  year  1798, 
when  it  slightly  exceeded  £33,000,000.  The  declared  value 
of  the  exports  of  British  and  Irish  produce  in  1815  ex- 
ceeded £49,000,000.  The  rise  in  the  value  of  the  exports  and 
imports  was  attributable  to  many  causes.  The  predomi- 
nance of  the  British  at  sea  had  driven  every  enemy  from 
the  ocean,  and  had  enabled  British  merchants  to  ply  their  trade 
in  comparative  safety.  The  numerous  possessions,  which  the 
British  had  acquired  in  every  quarter  of  the  globe,  had  provided 
them  with  customers  in  all  parts  of  the  world  ;  and  the  most 
civilized,  as  well  as  the  most  savage,  of  nations  were  purchasing 


32  SELECTIONS. 

the  produce  of  the  looms  of  Manchester  and  of  the  factories  of 
Birmingham.  Even  the  taxation  which  the  war  had  necessitated 
had  stimulated  the  manufacturers  to  fresh  exertions.  The  mer- 
chants were  continually  discovering  fresh  outlets  for  British 
trade  ;  the  manufacturers  were  constantly  encouraged  to  increase 
their  produce.1 

Wool  was  the  most  ancient  and  most  important  of  English 
manufactures.  Custom  seemed  to  point  to  the  permanent 
superiority  of  the  woollen  trade.  The  Chancellor  of  England  sat 
on  a  sack  of  wool ;  and  when  men  spoke  of  the  .staple  trade,  they 
always  referred  to  the  trade  in  wool.  For  centuries  British 
sovereigns  and  British  statesmen  had,  after  their  own  fashion,  and 
according  to  their  own  ideas,  actively  promoted  this  particular 
industry.  Edward  III.  had  induced  Flemish  weavers  to  settle 
in  this  country.  The  Restoration  Parliament  prohibited  the 
exportation  of  British  wool,  and  had  ordered  that  the  very  dead 
should  be  interred  in  woollen  shrouds.  The  manufacturers 
spread  over  the  entire  kingdom.  Wherever  there  was  a  running 
stream  to  turn  their  mill,  there  was  at  any  rate  the  possibility  of 
a  woollen  factory.  Norwich,  with  its  contiguous  village  of 
Worsted,  was  the  chief  seat  of  the  trade.  But  York  and  Brad- 
ford, Worcestershire  and  Gloucestershire,  Manchester  and  Ken- 
dal.  were  largely  dependent  on  it. 

The  steps,  which  Parliament  took  to  promote  this  particular 
industry,  were  not  always  very  wise  ;  in  one  point  they  were  not 
very  just.  Ireland,  in  many  respects,  could  have  competed  on 
advantageous  terms  with  the  woollen  manufacturers  of  England. 
English  jealousy  prohibited  in  consequence  the  importation  of 
Irish  manufactured  woollen  goods.  The  result  hardly  answered 
the  sanguine  anticipations  of  the  selfish  senators  who  had  secured 
it.  The  Irish,  instead  of  sending  their  fleeces  to  be  worked  up 
in  Great  Britain,  smuggled  them,  in  return  for  contraband  spirits, 
to  France.  England  failed  to  obtain  any  large  addition  to  her 
raw  material  ;  and  Ireland  was  driven  into  closer  communication 
with  the  hereditary  foe  of  England.  The  loss  of  the  Irish  fleeces 
was  the  more  serious  from  another  cause.  The  home  supply  of 
wool  had  originally  been  abundant  and  good  ;  but  its  production, 
at  the  commencement  of  the  century,  was  not  increasing  as 

1  McCulloch's  "  Commercial  Dictionary,"  imports  and  exports ;  cf.,  however,  Porter's 
"  Progress  of  the  Nation,"  p.  357,  where  the  figures  are  slightly  different.  Nothing  is  more 
difficult  than  to  ascertain  the  correct  figures. 


THE    GREAT   INVENTIONS.  33 

rapidly  as  the  demand  for  it ;  the  quality  of  home-grown  wool 
was  rapidly  deteriorating.  The  same  sheep  do  not  produce  both 
wool  and  mutton  in  the  greatest  perfection.  Every  improvement 
in  their  meat  is  effected  at  the  cost  of  their  fleece.  English  mut- 
ton was  better  than  it  had  ever  been  ;  but  English  manufacturers 
were  compelled  to  mix  foreign  with  native  wool.  Had  trade  been 
free  this  result  would  have  been  of  little  moment.  The  English 
could  have  easily  obtained  an  ample  supply  of  raw  material  from 
the  hills  of  Spain  and  other  countries.  But,  at  the  very  time  at 
which  foreign  wool  became  indispensable,  the  necessities  of  the 
country,  or  the  ignorance  of  her  financiers,  led  to  the  imposition 
of  a  heavy  import  duty  on  wool.  Addington,  in  1802,  levied  a 
duty  upon  it  of  55.  ^d.  the  cwt.  ;  Vansittart,  in  1813,  raised  the 
tax  to  6s.  8d.  The  folly  of  the  protectionists  had  done  much  to 
ruin  the  wool  trade.  But  the  evil  already  done  was  small  in 
comparison  with  that  in  store. 

Nowithstanding,  however,  the  restrictions  on  the  wool  trade, 
the  woollen  industry  was  of  great  importance.  In  1800,  Law,  as 
counsel  to  the  manufacturers,  declared,  in  an  address  to  the 
House  of  Lords,  that  600,000  packs  of  wool,  worth  £6,600,000. 
were  produced  annually  in  England  and  Wales,  and  that  1,500,- 
ooo  persons  were  employed  in  the  manufacture.  But  these  fig- 
ures, as  McCulloch  has  shown,  are  undoubtedly  great  exaggera- 
tions.1 Rather  more  than  400,000  packs  of  wool  were  available 
for  manufacturing  purposes  at  the  commencement  of  the  century  ; 
more  than  nine-tenths  of  these  were  produced  at  home  ;  and  some 
350,000  or  400,000  persons  were  probably  employed  in  the  trade. 
The  great  woollen  industry  still  deserved  the  name  of  our  staple 
trade  ;  but  it  did  not  merit  the  exaggerated  descriptions  which 
persons,  who  should  have  known  better,  applied  to  it. 

If  the  staple  trade  of  the  country  had  originally  been  in  woollen 
goods  at  the  commencement  of  the  present  century,  cotton  was 
rapidly  gaining  upon  wool.  Cotton  had  been  used  in  the 
extreme  East  and  in  the  extreme  West  from  the  earliest  periods 
of  which  we  have  anv  records.  The  Spaniards,  on  their  discov- 
ery of  America,  found  the  Mexicans  clothed  in  cotton.  "  There 
are  trees,"  Herodotus  had  written,  nearly  2,000  years  before, 
"  which  grow  wild  there  (in  India),  the  fruit  whereof  is  a  wool 
exceeding  in  beauty  and  goodness  that  of  sheep.  The 

1  "  McCulloch,"  ad  verb.     Wool;  Porter's  "  Progress  of  the  Nation,"  pp.  170-175. 


34  SELECTIONS. 

natives  make  their  clothes  of  this  tree  wool."1  But  though  the 
use  of  cotton  had  been  known  from  the  earliest  ages,  both  in 
India  and  America,  no  cotton  goods  were  imported  into  Europe  ; 
and  in  the  ancient  world  both  rich  and  poor  were  clothed  in 
silk,  linen,  and  wool.  The  industrious  Moors  introduced  cotton 
into  Spain.  Many  centuries  afterwards  cotton  was  imported 
into  Italy,  Saxony,  and  the  Low  Countries.  Isolated  from  the 
rest  of  Europe,  with  little  wealth,  little  industry,  and  no  roads  ; 
rent  by  civil  commotions ;  the  English  were  the  last  people  in 
Europe  to  introduce  the  manufacture  of  cotton  goods  into  their 
own  homes. 

Towards  the  close  of  the  sixteenth  century,  indeed,  cotton 
goods  were  occasionally  mentioned  in  the  Statute  Book,  and  the 
manufacture  of  the  cottons  of  Manchester  was  regulated  by  Acts 
passed  in  the  reigns  of  Henry  VIII.,  Edward  VI.  and  Elizabeth. 
But  there  seem  to  be  good  reasons  for  concluding  that  Manches- 
ter' cottons,  in  the  time  of  the  Tudors,  were  woollen  goods,  and 
did  not  consist  of  cotton  at  all.  More  than  a  century  elapsed 
before  any  considerable  trade  in  cotton  attracted  the  attention  of 
the  legislature.  The  woollen  manufacturers  complained  that 
people  were  dressing  their  children  in  printed  cottons ;  and 
Parliament  was  actually  persuaded  to  prohibit  the  introduction 
of  Indian  printed  calicoes.  Even  an  Act  of  Parliament,  how- 
ever, was  unable  to  extinguish  the  growing  taste  for  Indian 
cottons.  The  ladies,  according  to  the  complaint  of  an  old 
writer,  expected  "to  do  what  they  please,  to  say  what  they 
please,  and  wear  what  they  please."  The  taste  for  cotton  led  to 
the  introduction  of  calico-printing  in  London  ;  Parliament,  in 
order  to  encourage  the  new  trade,  was  induced  to  sanction  the 
importation  of  plain  cotton  cloths  from  India  under  a  duty.  The 
demand,  which  was  thus  created  for  calicoes,  probably  promoted 
their  manufacture  at  home  ;  and  Manchester,  Bolton,  Frome,  and 
other  places,  gradually  acquired  fresh  vitality  from  the  creation 
of  a  new  history. 

Many  years,  however,  passed  before  the  trade  attained  anything 
but  the  slenderest  proportions.  In  the  year  1697  only  1,976,- 
359  Ibs.  of  cotton  wool  were  imported  into  the  United  Kingdom. 
In  the  year  1751  only  2,976,610  Ibs.  were  imported.  The  official 
value  of  cotton  goods  exported  amounted  in  the  former  year  to 

1  Rawlinson's  "  Herodotus,"  vol.  ii.  p.  411.  The  German  name  for  cotton  is  Baumwolle 
—  tree  wool. 


THE   GREAT   INVENTIONS.  35 

only  £5,915  ;  in  the  latter  year  to  only  £45,986.  At  the  present 
time  Britain  annually  purchases  about  1,500,000,000  Ibs.  of  cotton 
wool.  She  annually  disposes  of  cotton  goods  worth  £60,000,000. 
The  import  trade  is  500  times  as  large  as,  it  was  in  I751  5  the 
value  of  the  exports  has  been  increased  1,300  fold.  The  world 
has  never  seen,  in  any  similar  period,  so  prodigious  a  growth  of 
manufacturing  industry.  But  the  trade  has  not  merely  grown 
from  an  infant  into  a  giant ;  its  conditions  have  been  concurrently 
revolutionized.  Up  to  the  middle  of  the  last  century  cotton 
goods  were  really  never  made  at  all.  The  so-called  cotton  manu- 
factures were  a  combination  of  wool  or  linen  and  cotton.  No 
Englishman  had  been  able  to  produce  a  cotton  thread  strong 
enough  for  the  warp  ;  and  even  the  cotton  manufacturers  them- 
selves appear  to  have  despaired  of  doing  so.  They  induced  Par- 
liament in  1736  to  repeal  the  prohibition,  which  still  encumbered 
the  Statute  Book,  against  wearing  printed  calicoes  ;  but  the  re- 
peal was  granted  on  the  curious  condition  "  that  the  warp  thereof 
be  entirely  linen  yarn."  Parliament  no  doubt  intended  by  this 
condition  to  check  the  importation  of  Indian  goods  without  inter- 
fering with  the  home  manufacturers.  The  superior  skill  of  the 
Indian  manufacturers  enabled  them  to  use  cotton  for  a  warp  ; 
while  clumsy  workmanship  made  the  use  of  cotton  as  a  warp  un- 
attainable at  home. 

In  the  middle  of  the  eighteenth  century,  then,  a  piece  of  cotton 
cloth,  in  the  true  sense  of  the  term,  had  never  been  made  in  Eng- 
land. The  so-called  cotton  goods  were  all  made  in  the  cottages 
of  the  weavers.  The  yarn  was  carded  by  hand  ;  it  was  spun  by 
hand  ;  it  was  worked  into  cloth  by  a  hand-loom.  The  weaver 
was  usually  the  head  of  the  family  ;  his  wife  and  unmarried 
daughters  spun  the  yarn  for  him.  Spinning  was  the  ordinary 
occupation  of  every  girl,  and  the  distaff  was,  for  countless  centu- 
ries, the  ordinary  occupation  of  every  woman.  The  occupation 
was  so  universal  that  the  distaff'  was  occasionally  used  as  a  syno- 
nym for  woman.  "  Le  royaume  de  France  ne  tombe  point  en 
quenouille." 

"  See  my  royal  master  murdered, 
His  crown  usurped,  a  distaff  in  the  throne." 

To  this  day  every  unmarried  girl  is  commonly   described    as  a 
"  spinster." 

The  operation  of  weaving  was,  however,  much  more  rapid  than 


36  SELECTIONS. 

that  of  spinning.  The  weaver  consumed  more  weft  than  his  own 
family  could  supply  him  with ;  and  the  weavers  generally 
experienced  the  greatest  difficulty  in  obtaining  sufficient  yarn. 
About  the  middle  of  .the  eighteenth  century  the  ingenuity  of  two 
persons,  a  father  and  a  son,  made  this  difference  more  apparent. 
The  shuttle  had  originally  been  thrown  by  the  hand  from  one 
end  of  the  loom  to  the  other.  John  Kay.  a  native  of  Bury,  by 
his  invention  of  the  fly-shuttle,  saved  the  weaver  from  this 
labor.  The  lathe,  in  which  the  shuttle  runs,  was  lengthened  at 
both  ends ;  two  strings  were  attached  to  its  opposite  ends  ;  the 
strings  were  held  by  a  peg  in  the  weaver's  hands,  and,  by 
plucking  the  peg,  the  weaver  was  enabled  to  give  the  neces- 
sary impulse  to  the  shuttle.  Robert  Kay,  John  Kay's  son,  added 
the  drop-box,  by  means  of  which  the  weaver  was  able  tk  to  use 
any  one  of  the  three  shuttles,  each  containing  a  different  colored 
weft,  without  the  trouble  of  taking  them  from  and  replacing  them 
in  the  lathe."  By  means  of  these  inventions  the  productive 
power  of  each  weaver  was  doubled.  Each  weaver  was  easily 
able  to  perform  the  amount  of  work  which  had  previously 
required  two  men  to  do ;  and  the  spinsters  found  themselves 
more  hopelessly  distanced  than  ever  in  their  efforts  to  supply  the 
weavers  with  weft. 

The  preparation  of  weft  was  entirely  accomplished  by  manual 
labor,  and  the  process  was  very  complicated.  Carding  and  roving 
were  both  slowly  performed  with  the  aid  of  the  clumsy  imple- 
ments which  had  originally  been  invented  for  the  purpose. 
"  Carding  is  the  process  to  which  the  cotton  is  subjected  after  it 
has  been  opened  and  cleaned,  in  order  that  the  fibres  of  the  wool 
may  be  disentangled,  straightened,  and  laid  parallel  with  each 
other,  so  as  to  admit  of  being  spun.  This  was  formerly  effected 
by  instruments  called  hand-cards,  which  were  brushes  made  of 
short  pieces. of  wire  instead  of  bristles,  the  wires  being  stuck  into 
a  sheet  of  leather,  at  a  certain  angle,  and  the  leather  fastened  on  a 
flat  piece  of  wood  about  twelve  inches  long  and  five  wide,  with  a 
handle.  The  cotton  being  spread  upon  one  of  the  cards,  it  was 
repeatedly  combed  with  another  till  all  the  fibres  were  laid 
straight,  when  it  was  stripped  oft'  the  card  in  a  fleecy  roll  ready 
for  the  rover.  In  '  roving  '  the  spinner  took  the  short  fleecy 
rolls  in  which  the  cotton  was  stripped  off  the  hand-cards,  applied 
them  successively  to  the  spindle,  and  whilst  with  one  hand  she 
turned  the  wheel  and  thus  made  the  spindle  revolve,  with  the 


THE   GREAT    INVENTIONS.  37 

other  she  drew  out  the  cardings,  which,  receiving  a  slight  twist 
from  the  spindle,  were  made  into  thick  threads  called  rovings, 
and  wound  upon  the  spindle  so  as  to  form  cops."  In  spinning, 
"  the  roving  was  spun  into  yarn  ;  the  operation  was  similar,  but 
the  thread  was  drawn  out  much  finer  and  received  much  more 
twist.  It  will  be  seen  that  this  instrument  only  admitted  of  one 
thread  being  spun  at  a  time  by  one  pair  of  hands,  and  the  slow- 
ness of-  the  operation  and  consequent  expensiveness  of  the 
yarn  formed  a  great  obstacle  to  the  establishment  of  a  new  manu- 
facture." 

The  trade  was  in  this  humble  and  primitive  state  when  a  series 
of  extraordinary  and  unparalleled  inventions  revolutionized  the 
conditions  on  which  cotton  had  been  hitherto  prepared.  A  little 
more  than  a  century  ago  John  Hargreaves,  a  poor  weaver  in  the 
neighborhood  of  Blackburn,  was  returning  home  from  a  long  walk, 
in  which  he  had  been  purchasing  a  further  supply  of  yarn  for  his 
loom.  As  he  entered  his  cottage,  his  wife  Jenny  accidentally 
upset  the  spindle  which  she  was  using.  Hargreaves  noticed  that 
the  spindles,  which  were  now  thrown  into  an  upright  position, 
continued  to  revolve,  and  that  the  thread  was  still  spinning  in  his 
wife's  hand.  The  idea  immediately  occurred  to  him  that  it 
would  be  possible  to  connect  a  considerable  number  of  upright 
spindles  with  one  wheel,  and  thus  multiply  the  productive 
power  of  each  spinster.  "  He  contrived  a  frame  in  one  part  of 
which  he  placed  eight  rovings  in  a  row,  and  in  another  part  a 
row  of  eight  spindles.  The  i-ovings,  when  extended  to  the 
spindles  passed  between  two  horizontal  bars  of  wood,  forming  a 
clasp  which  opened  and  shut  somewhat  like  a  parallel  ruler. 
When  pressed  together  this  clasp  held  the  threads  fast ;  a  certain 
portion  of  roving  being  extended  from  the  spindles  to  the  wooden 
clasp,  the  clasp  was  closed,  and  was  then  drawn  along  the 
horizontal  frame  to  a  considerable  distance  from  the  spindles, 
by  which  the  threads  were  lengthened  out  and  reduced  to  the 
proper  tenuity  ;  this  was  done  with  the  spinner's  left  hand,  and 
his  right  hand  at  the  same  time  turned  a  wheel  which  caused  the 
spindles  to  revolve  rapidly,  and  thus  the  roving  was  spun  into 
yarn.  By  returning  the  clasp  to  its  first  situation  and  letting 
down  a  piercer  wire,  the  yarn  was  wound  upon  the  spindle." 

Hargreaves  succeeded  in  keeping  his  admirable  invention 
secret  for  a  time  ;  but  the  powers  of  his  machine  soon  became 
known.  His  ignorant  neighbors  hastily  concluded  that  a  machine, 


38  SELECTIONS. 

which  enabled  one  spinster  to  do  the  work  of  eight,  would  throw 
multitudes  of  persons  out  of  employment.  A  mob  broke  into  his 
house  and  destroyed  his  machine.  Hargreaves  himself  had  to 
retire  to  Nottingham,  where,  with  the  friendly  assistance  of 
another  person,  he  was  able  to  take  out  a  patent  for  the  spinning- 
jenny,  as  the  machine,  in  compliment  to  his  industrious  wife,  was 
called. 

The  invention  of  the  spinning-jenny  gave  a  new  impulse  to  the 
cotton  manufacture.  But  the  invention  of  the  spinning-jenny,  if 
it  had  been  accompanied  by  no  other  improvements,  would  not 
have  allowed  any  purely  cotton  goods  to  be  manufactured  in 
England.  The  yarn  spun  by  the  jenny,  like  that  which  had  pre- 
viously been  spun  by  hand,  was  neither  fine  enough  nor  hard 
enough  to  be  employed  as  warp,  and  linen  or  woollen  threads  had 
consequently  to  be  used  for  this  purpose.  In  the  very  year,  how- 
ever, in  which  Hargreaves  moved  from  Blackburn  to  Nottingham, 
Richard  Arkwright  took  out  a  patent  for  his  still  more  celebrated 
machine.  It  is  alleged  that  John  Wyatt,  of  Birmingham,  thirty 
years  before  the  date  of  Arkwright's  patent,  had  elaborated  a  ma- 
chine for  spinning  by  rollers.  But  in  a  work  of  this  description 
it  is  impossible  to  analyze  the  conflicting  claims  of  rival  inventors 
to  the  credit  of  discovering  particular  machinery  ;  and  the  histo- 
rian can  do  no  more  than  record  the  struggles  of  those  whose 
names  are  associated  with  the  improvements  which  he  is  noticing. 
Richard  Arkwright,  like  John  Hargreaves,  had  a  humble  origin. 
Hargreaves  began  life  as  a  poor  weaver ;  Arkwright,  as  a  barber's 
assistant.  Hargreaves  had  a  fitting  partner  in  his  industrious 
wife  Jenny.  Mrs.  Arkwright  is  said  to  have  destroyed  the 
models  which  her  husband  had  made.  But  Arkwright  was  not 
deterred  from  his  pursuit  by  the  poverty  of  his  circumstances  or 
the  conduct  of  his  wife.  "After  many  years'  intense  and  painful 
application,"  he  invented  his  memorable  machine  for  spinning  by 
rollers ;  and  laid  the  foundations  of  the  gigantic  industry  which 
has  done  more  than  any  other  trade  to  concentrate  in  this  country 
the  wealth  of  the  world.  The  principle  of  Arkwright's  great  in- 
vention is  very  simple.  He 'passed  the  thread  over  two  pairs  of 
rollers,  one  of  which  was  made  to  revolve  much  more  rapidly 
than  the  other.  The  thread,  after  passing  over  the  pair  revolving 
slowly,  was  drawn  into  the  requisite  tenuity  by  the  rollers  revolv- 
ing at  a  higher  rapidity.  By  this  simple  but  memorable  inven- 
tion Arkwright  succeeded  in  producing  thread  capable  of  employ- 


THE    GREAT   INVENTIONS.  39 

ment  as  warp.  From  the  circumstance  that  the  mill  at  which  his 
machinery  was  first  erected  was  driven  by  water  power,  the 
machine  received  the  somewhat  inappropriate  name  of  the  water- 
frame  ;  the  thread  spun  by  it  was  usually  called  the  water-twist. 

The  invention  of  the  fly-shuttle  by  John  Kay  had  enabled  the 
weavers  to  consume  more  cotton  than  the  spinsters  had  been  able 
to  provide  ;  the  invention  of  the  spinning-jenny  and  the  water- 
frame  would  have  been  useless  if  the  old  system  of  hand-carding 
had  not  been  superseded  by  a  more  efficient  and  more  rapid 
process.  Just  as  Arkvvright  applied  rotatory  motion  to  spinning, 
so  Lewis  Paul  introduced  revolving  cylinders  for  carding  cotton. 
Paul's  machine  consisted  of  "a  horizontal  cylinder,  covered  in 
its  whole  circumference  with  parallel  rows  of  cards  with  inter- 
vening spaces,  and  turned  by  a  handle.  Under  the  cylinder  was 
a  concave  frame,  lined  internally  with  cards  exactly  fitting  the 
lower  half  of  the  cylinder,  so  that  when  the  handle  was  turned, 
the  cards  of  the  cylinder  and  of  the  concave  frame  worked  against 
each  other  and  carded  the  wool."  "  The  cardings  were  of  course 
only  of  the  length  of  the  cylinder,  but  an  ingenious  apparatus 
was  attached  for  making  them  into  a  perpetual  carding.  Each 
length  was  placed  on  a  flat  broad  riband  which  was  extended 
between  two  short  cylinders  and  which  wound  upon  one  cylinder 
as  it  unwound  from  the  other."1 

This  extraordinary  series  of  inventions  placed  an  almost  unlim- 
ited supply  of  yarn  at  the  disposal  of  the  weaver.  But  the 
machinery,  which  had  thus  been  introduced,  was  still  incapable 
of  providing  yarn  fit  for  the  finer  qualities  of  cotton  cloth.  "  The 
water-frame  spun  twist  for  warps,  but  it  could  not  be  advantage- 
ously used  for  the  finer  qualities,  as  thread  of  great  tenuity  has 
not  strength  to  bear  the  pull  of  the  rollers  when  winding  itself 
on  the  bobbin."  This  delect,  however,  was  removed  by  the 
ingenuity  of  Samuel  Crompton,  a  young  weaver  residing  near 
Bolton.  Crompton  succeeded  in  combining  in  one  machine  the 
various  excellences  of  " Ark w right's  water-frame  and  Har- 
greaves'  jenny."  Like  the  former,  his  machine,  which  from  its 
nature  is  happily  called  the  mule,  "  has  a  system  of  rollers  to 
reduce  the  roving ;  and,  like  the  latter,  it  has  spindles  without 
bobbins  to  give  the  twist,  and  the  thread  is  stretched  and  spun 
at  the  same  time  by  the  spindles  after  the  rollers  have  ceased  to 

1  Baines'  "  Hist,  of  the  Cotton  Manufacture,"  p.  173,  from  which  work  the  preceding  quo- 
tations are  also  taken. 


40  SELECTIONS. 

give  out  the  rove.  The  distinguishing  feature  of  the  mule  is  that 
the  spindles,  instead  of  being  stationary,  as  in  both  the  other 
machines,  are  placed  on  a  movable  carriage,  which  is  wheeled 
out  to  the  distance  of  fifty- four  or  fifty-six  inches  from  the  roller 
beam,  in  order  to  stretch  and  twist  the  thread,  and  wheeled  in 
again  to  wind  it  on  the  spindles.  In  the  jenny,  the  clasp,  which 
held  the  rovings,  was  drawn  back  by  the  hand  from  the  spindles  ; 
in  the  mule,  on  the  contrary,  the  spindles  recede  from  the  clasp, 
or  from  the  roller  beam,  which  acts  as  a  clasp.  The  rollers  of 
the  mule  draw  out  the  roving  much  less  than  those  of  the  water- 
frame,  and  they -act  like  the  clasp  of  the  jenny  by  stopping  and 
holding  fast  the  rove,  after  a  certain  quantity  has  been  given  out, 
whilst  the  spindles  continue  to  recede  for  a  short  distance  farther, 
so  that  the  draught  of  the  thread  is  in  part  made  by  the  receding 
of  the  spindles.  By  this  arrangement,  comprising  the  advantages 
both  of  the  roller  and  the  spindles,  the  thread  is  stretched  more 
gently  and  equably,  and  a  much  finer  quality  of  yarn  can  there- 
fore be  produced."1 

The  effects  of  Crompton's  great  invention  may  be  stated  epi- 
grammatically.  Before  Crompton's  time  it  was  thought  impossi- 
ble to  spin  eighty  hanks  to  the  pound.  The  mule  has  spun  three 
hundred  and  fifty  hanks  to  the  pound  !  The  natives  of  India  could 
spin  a  pound  of  cotton  into  a  thread  119  miles  long.  The  Eng- 
lish succeeded  in  spinning  the  same  thread  to  a  length  of  160 
miles.2  Yarn  of  the  finest  quality  was  at  once  at  the  disposal  of 
the  weaver,  and  an  opportunity  was  afforded  for  the  production 
of  an  indefinite  quantity  of  cotton  yarn.  But  the  great  inventions, 
which  have  been  thus  enumerated,  would  not  of  themselves  have 
been  sufficient  to  establish  the  cotton  manufacture  on  its  present 
basis.  The  ingenuity  of  Hargreaves,  Arkwright,  and  Crompton 
had  been  exercised  to  provide  the  weaver  with  yarn.  Their  in- 
ventions had  provided  him  with  more  yarn  than  he  could  by  any 
possibility  use.  The  spinster  had  beaten  the  weaver,  just  as  the 
weaver  had  previously  beaten  the  spinster,  and  the  manufacture 
of  cotton  seemed  likely  to  stand  still  because  the  yarn  could  not 
be  woven  more  rapidly  than  an  expert  workman  with  Kay's 
improved  fly-shuttle  could  weave  it. 

Such  a  result  was  actually  contemplated  by  some  of  the  leading 
manufacturers,  and  such  a  result  might  possibly  have  temporarily 

1  Baines'  "  Hist,  of  the  Cotton  Manufacture,"  pp.  197,  198. 
1  Ibid.,  p.  aoo,  and  "  Colchester,"  vol.  ii.  p.  75. 


THE   GREAT   INVENTIONS.  41 

occurred  if  it  had  not  been  averted  by  the  ingenuity  of  a  Kentish 
clergyman.  Edmund  Cartwright,  a  clergyman  residing  in  Kent, 
happened  to  be  staying  at  Matlock  in  the  summer  of  1784,  and  to 
be  thrown  into  the  company  of  some  Manchester  gentlemen. 
The  conversation  turned  on  Arkwright's  machinery,  and  "  one 
of  the  company  observed  that,  as  soon  as  Arkwright's  patent  ex- 
pired, so  many  mills  would  be  erected  and  so  much  cotton  spun 
that  hands  would  never  be  found  to  weave  it."  Cartwright  replied 
"  that  Arkwright  must  then  set  his  wits  to  work  to  invent  a 
weaving  mill."  The  Manchester  gentlemen,  however,  unani- 
mously agreed  that  the  thing  was  impracticable.  Cartwright 
"  controverted  the  impracticability  by  remarking  that  there  had 
been  exhibited  an  automaton  figure  which  played  at  chess  ;  "  it 
could  not  be  "  more  difficult  to  construct  a  machine  that  shall 
weave  than  one  which  shall  make  all  the  variety  of  moves  which 
are  required  in  that  complicated  game."  Within  three  years  he 
had  himself  proved  that  the  invention  was  practicable  by  produc- 
ing the  power-loom.  Subsequent  inventors  improved  the  idea 
which  Cartwright  had  originated,  and  within  fifty  years  from  the 
date  of  his  memorable  visit  to  Matlock  there  were  not  less  than 
100,000  power-looms  at  work  in  Great  Britain  alone.1 

The  inventions,  which  have  been  thus  enumerated,  are  the 
most  remarkable  of  the  improvements  which  stimulated  the  de- 
velopment of  the  cotton  industry.  But  other  inventions,  less 
generally  remembered,  were  hardly  less  wonderful  or  less  bene- 
ficial than  these.  Up  to  the  middle  of  last  century  cotton  could 
only  be  bleached  by  the  cloth  being  steeped  in  alkaline  lyes  for 
several  days,  washed  clean,  and  spread  on  the  grass  for  some 
weeks  to  dry.  The  process  had  to  be  repeated  several  times,  and 
many  months  were  consumed  before  the  tedious  operation  was 
concluded.  Scheele,  the  Swedish  philosopher,  discovered  in 
1774  the  bleaching  properties  of  chlorine,  or  oxymuriatic  acid. 
Berthollet,  the  French  chemist,  conceived  in  1785  the  idea  of  ap- 
plying the  acid  to  bleaching  cloth.  Watt,  the  inventor  of  the 
steam-engine,  and  Henry  of  Manchester,  respectively  introduced 
the  new  acid  into  the  bleach-fields  of  Macgregor  of  Glasgow  and 
Ridgway  of  Bolton.  The  process  of  bleaching  was  at  once  re- 
duced from  months  to  days,  or  even  hours.9 

In  the  same  year  in  which  Watt  and  Henry  were  introducing 

'Baines'  "  Cotton,"  pp.  229,  235. 
2  Ibid.,  pp.  247-349. 


42  SELECTIONS. 

the  new  acid  to  the  bleacher,  Bell,  a  Scotchman,  was  laying  the 
foundations  of  a  trade  in  printed  calicoes.  "  The  old  method  of 
printing  was  by  blocks  of  sycamore,  about  10  inches  long  by  5 
broad,  on  the  surface  of  which  the  pattern  was  cut  in  relief  in  the 
common  method  of  wood  engraving."  As  the  block  had  to  be 
applied  to  the  cloth  by  hand,  "  no  more  of  it  could  be  printed  at 
once  than  the  block  could  cover,  and  a  single  piece  of  calico,  28 
yards  in  length,  required  the  application  of  the  block  448 
times."  1  This  clumsy  process  was  superseded  by  cylinder  print- 
ing. "  A  polished  copper  cylinder,  several  feet  in  length,  and  3 
or  4  inches  in  diameter,  is  engrayed  with  a  pattern  round  its 
whole  circumference  and  from  end  to  end.  It  is  then  placed 
horizontally  in  a  press,  and,  as  it  revolves,  the  lower  part  of  the 
circumference  passes  through  the  coloring  matter,  which  is  again 
removed  from  the  whole  surface  of  the  cylinder,  except  the 
engraved  pattern,  by  an  elastic  steel  blade  placed  in  contact  with 
the  cylinder,  and  reduced  to  so  fine  and  straight  an  edge  as  to 
take  off  the  color  without  scratching  the  copper.  The  color 
being  thus  left  only  in  the  engraved  pattern,  the  piece  of  calico  or 
muslin  is  drawn  tightly  over  the  cylinder,  which  revolves  in  the 
same  direction,  and  prints  the  cloth."  The  saving  of  labor 
"  effected  by  the  machine"  is  "  immense;  one  of  the  cylinder 
machines,  attended  by  a  man  and  a  boy,  is  actually  capable  of 
producing  as  much  work  as  could  be  turned  out  by  one  hundred 
block  printers,  and  as  many  tear  boys."  '*' 

Such  are  the  leading  inventions,  which  made  Great  Britain  in  less 
than  a  century  the  wealthiest  country  in  the  world.  "  When  we 
undertook  the  cotton  manufacture  we  had  comparatively  few 
facilities  for  its  prosecution,  and  had  to  struggle  with  the  greatest 
difficulties.  The  raw  material  was  produced  at  an  immense  dis- 
tance from  our  shores,  and  in  Hindustan  and  in  China  the  inhabi- 
tants had  arrived  at  such  perfection  in  the  arts  of  spinning  and 
weaving,  that  the  lightness  and  delicacy  of  their  finest  cloths 
emulated  the  web  of  the  gossamer,  and  seemed  to  set  competition 
at  defiance.  Such,  however,  has  been  the  influence  of  the  stu- 
pendous discoveries  and  inventions  of  Hargreaves,  Arkwright, 
Crompton,  Cartwright,  and  others,  that  we  have  overcome  all 
these  difficulties,  — that  neither  the  extreme  cheapness  of  labor  in 
Hindustan,  nor  the  excellence  to  which  the  natives  had  attained, 

1  Baines'  "  Cotton,"  pp.  264,  265. 
»  Ibid.,  pp.  265,  366. 


THE    GREAT   INVENTIONS.  43 

bas  enabled  them  to  withstand  the  competition  of  those,  who  buy 
their  cotton,  and  who,  after  carrying  it  5,000  miles  to  be  manu- 
factured, carry  back  the  goods  to  them."  1 

If  Great  Britain  entirely  monopolized  the  woollen  and  the  cotton 
trades,  she  had  done  her  best,  in  her  own  way,  to  promote  the 
manufacture  of  linen  in  Ireland.  In  1698  Parliament,  while 
rigorously  prohibiting  the  exportation  of  Irish  woollen  goods, 
sedulously  attempted  to  encourage  the  linen  manufacture  in  Ire- 
land. Bounties  were  paid  on  all  linen  goods  imported  into  this 
country  from  the  sister  island  ;  and  the  great  linen  trade  acquired, 
especially  in  Ulster,  the  importance  which  it  still  retains.  In 
1800,  31,978,039  yards  of  linen  were  exported  from  Ireland  to 
Great  Britain,  and  2,585,829  yards  to  other  countries.  In  1815, 
the  export  trade  had  risen  to  37,986,359  and  5,496,206  yards 
respectively.  A  formidable  rival  to  Ulster  was,  however,  slowly 
rising  in  another  part  of  the  kingdom.  At  the  close  of  the  great 
French  war  Dundee  was  still  an  insignificant  manufacturing 
town,  but  the  foundations  were  already  laid  of  the  surprising 
supremacy  which  she  has  since  acquired  in  the  linen  trade. 
Some  3,000  tons  of  flax  were  imported  into  the  Scotch  port  in 
1814.  But  the  time  was  rapidly  coming  when  the  shipments  of 
linen  from  this  single  place  were  to  exceed  those  from  all  Ireland, 
and  Dundee  was  to  be  spoken  of  by  professed  economists  as  the 
Manchester  of  the  linen  trade.3 

The  silk  manufacturers  of  Britain  have  never  yet  succeeded  in 
acquiring  the  predominance  which  the  woollen,  cotton,  and  linen 
factors  have  virtually  obtained.  The  worm,  by  which  the  raw 
material  is  produced,  has  never  been  acclimatized  on  a  large 
scale  in  England  ;  and  the  trade  has  naturally  flourished  chiefly 
in  those  countries  where  the  worm  could  live  and  spin,  or  where 
the  raw  material  could  be  the  most  easily  procured.  Insular  preju- 
dice, moreover,  should  not  induce  the  historian  to  forget  another 
reason  which  has  materially  interfered  with  the  development 
of  this  particular  trade.  The  ingenuity  of  the  British  was  supe- 
rior to  that  of  every  other  nation  ;  but  the  taste  of  the  British 
was  inferior  to  that  of  most  people.  An  article  which  was  only 
worn  by  the  rich,  and  which  was  only  used  for  its  beauty  and 
delicacy,  was  naturally  produced  most  successfully  by  the  most 
artistic  people.  English  woollen  goods  found  their  way  to  every 

1  McCulloch's  "  Commercial  Diet.,"  ad  verb.  Cotton. 

JMcCulloch,  ad  verb.  Linen;  Porter's  "Progress  of  the  Nation,"  p.  330. 


44  SELECTIONS. 

continental  nation  ;  but  the  wealthy  English  imported  their  finest; 
lustrings  and  a  les  modes  from  Italy  and  France.  The  silk  trade 
would,  in  fact,  have  hardly  found  a  home  in  England  at  all  had 
it  not  been  for  the  folly  of  a  neighboring  potentate.  Louis  XIV., 
in  a  disastrous  hour  for  France,  revoked  the  Edict  of  Nantes  ; 
and  the  French  Huguenots,  to  their  eternal  honor,  preferring 
their  consciences  to  their  country,  sought  a  home  amongst  a  more 
liberal  people.  The  silk  weavers  of  France  settled  in  Spital- 
fields,  and  the  British  silk  trade  gained  rapidly  on  its  foreign 
rivals.  Parliament  adopted  the  usual  clumsy  contrivances  to 
promote  an  industry  whose  importance  it  was  no  longer  possible 
to  ignore.  Prohibitory  duties,  designed  to  discourage  the  im- 
portation of  foreign  silk,  were  imposed  by  the  legislature ; 
monopolies  were  granted  to  successful  throwsters,  and  every 
precaution'  was  taken  which  the  follies  of  protection  could 
suggest,  to  perpetuate  the  supremacy  which  Great  Britain  was 
gradually  acquiring  in  the  silk  trade.  The  usual  results  fol- 
lowed this  short-sighted  policy.  Prohibitory  duties  encouraged 
smuggling.  Foreign  silk  found  its  way  into  England,  and  the 
revenue  was  defrauded  accordingly.  The  English  trade  began 
to  decline,  and  Parliament  again  interferred  to  promote  its  pros- 
perity. In  that  unhappy  period  of  English  history  which 
succeeds  the  fall  of  Chatham  and  the  rise  of  Pitt,  Parliament 
adopted  fresh  expedients  to  promote  the  prosperity  of  the  silk 
trade.  Prohibitory  duties  were  replaced  with  actual  prohibition, 
and  elaborate  attempts  were  made  to  regulate  the  wages  of  the 
Spitalfields  weavers.  The  natural  consequences  ensued.  Smug- 
gling, which  had  been  created  by  prohibitive  duties,  flourished 
with  fresh  vitality  under  the  influence  of  actual  prohibition.  The 
capitalists  transferred  their  mills  from  Spitalfields,  where  the 
labors  of  their  workmen  were  fixed  by  law,  to  Macclesfield  and 
other  places,  where  master  and  workmen  were  free  to  make  their 
own  terms. 

The  silk  trade  was  hardly  being  developed  with  the  same 
rapidity  as  the  three  other  textile  industries.  But  silk,  like 
wool,  cotton,  and  linen,  was  affording  a  considerable  amount  of 
employment  to  a  constantly  growing  population.  The  textile 
industries  of  this  country  could  not  indeed  have  acquired  the  im- 
portance which  they  have  since  obtained,  if  the  inventions  of 
Hargreaves,  Arkwright,  Crompton,  and  Cartwright  had  not  been 
supplemented  by  the  labors  of  explorers  in  another  field.  Ma- 


THE   GREAT   INVENTIONS.  45 

chinery  makes  possible  what  man  by  manual  labor  alone  would 
find  it  impossible  to  perform.  But  machinery  would  be  a  use- 
less incumbrance  were  it  not  for  the  presence  of  some  motive 
power.  From  the  earliest  ages  men  have  endeavored  to  supple- 
ment the  brute  force  of  animals  with  the  more  powerful  forces 
which  nature  has  placed  at  their  disposal.  The  ox  was  not  to  be 
perpetually  used  to  tread  out  the  corn  ;  women  were  not  always 
to  pass  their  days  laboriously  grinding  at  a  mill.  The  movement 
of  the  atmosphere,  the  flow  of  running  water,  were  to  be  taken 
into  alliance  with  man  ;  and  the  invention  of  wind-mills  and 
water-mills  was  to  mark  an  advance  in  the  onward  march  of 
civilization.  But  air  and  water,  mighty  forces  as  they  are,  proved 
but  fickle  and  uncertain  auxiliaries.  When  the  wind  was  too 
low  its  strength  was  insufficient  to  turn  the  cumbrous  sails  of  the 
mill ;  when  it  was  too  high  it  deranged  the  complicated  ma- 
chinery of  the  miller.  The  miller  who  trusted  to  water  was 
hardly  more  fortunate  than  the  man  who  relied  upon  air.  A 
summer  drought  reduced  the  power  of  his  wheel  at  the  verv  time 
when  long  days  and  fine  weather  made  him  anxious  to  accomplish 
the  utmost  possible  amount  of  work.  A  flood  swept  away  the 
dam  on  which  his  mill  depended  for  its  supply  of  water.  An 
admirable  auxiliary  during  certain  portions  of  each  year,  water 
was  occasionally  too  strong,  occasionally  too  weak,  for  the  pur- 
poses of  the  miller. 

The  manufacturing  industry  of  the  country  stood,  therefore,  in 
need  of  a  new  motive  power;  and  invention,  which  is  supposed 
by  some  thinkers  to  depend  like  other  commodities  on  the  laws 
of  demand  and  supply,  was  busily  elaborating  a  new  problem,  — 
the  use  of  a  novel  power,  which  was  to  revolutionize  the  world. 
The  elasticity  of  hot  water  had  long  been  noticed,  and,  for  a 
century  and  a  half  before  the  period  of  this  history,  a  few 
advanced  thinkers  had  been  speculating  on  the  possibility  of 
utilizing  the  expansive  powers  of  steam.  The  Marquis  of 
Worcester  had  described,  in  his  "  Century  of  Inventions,"  "  an 
admirable  and  most  forcible  way  to  drive  up  water  by  means  of 
fire."  Steam  was  actually  used  early  in  the  eighteenth  century 
as  a  motive  power  for  pumping  water  from  mines  ;  and  New- 
comen,  a  blacksmith  in  Dartmouth,  invented  a  tolerably  efficient 
steam-engine.  It  was  not,  however,  till  1769,  that  James  Watt, 
a  native  of  Greenock,  and  a  mathematical  instrument-maker  in 
Glasgow,  obtained  his  first  patent  for  "  methods  of  lessening  the 


46  SELECTIONS. 

consumption  of  steam,  and  consequently  of  fuel,  in  fire-engines." 
James  Watt  was  born  in  1736.  His  father  was  a  magistrate, 
and  had  the  good  sense  to  encourage  the  good  turn  for  mechanics 
which  his  son  displayed  at  a  very  early  age.  At  the  age  of 
nineteen  Watt  was  placed  with  a  mathematical  instrument-maker 
in  London.  But  feeble  health,  which  had  interfered  with  his 
studies  as  a  boy.  prevented  him  from  pursuing  his  avocations  in 
England.  Watt  returned  to  his  native  country.  The  Glasgow 
body  of  Arts  and  Trades,  however,  refused  to  allow  him  to 
exercise  his  calling  within  the  limits  of  their  jurisdiction  ;  and 
had  it  not  been  for  the  University  of  Glasgow,  which  befriended 
him  in  his  difficulty,  and  appointed  him  their  mathematical 
instrument-maker,  the  career  of  one  of  the  greatest  geniuses 
whom  Great  Britain  has  produced  would  have  been  stinted  at 
its  outset. 

There  happened  to  be  in  the  University  a  model  of  New- 
comen's  engine.  It  happened,  too,  that  the  model  was  defec- 
tively constructed.  Watt,  in  the  ordinary  course  of  his  business, 
was  asked  to  remedy  its  defects,  and  he  soon  succeeded  in  doing 
so.  But  his  examination  of  the  model  convinced  him  of  serious 
faults  in  the  original.  Newcomen  had  injected  cold  water  into 
the  cylinder  in  order  to  condense  the  steam  and  thus  obtain  a 
necessary  vacuum  for  the  piston  to  work  in.  Watt  discovered 
that  three-fourths  of  the  fuel  which  the  engine  consumed  was 
required  to  reheat  the  cylinder.  "  It  occurred  to  him  that,  if  the 
condensation  could  be  performed  in  a  separate  vessel,  communi- 
cating with  the  cylinder,  the  latter  could  be  kept  hot,  while  the 
former  was  cooled,  and  the  vapor  arising  from  the  injected  water 
could  also  be  prevented  from  impairing  the  vacuum.  The  com- 
munication could  easily  be  effected  by  a  tube,  and  the  water  could 
be  pumped  out.  This  is  the  first  and  the  grand  invention  by  which 
he  at  once  saved  three-fourths  of  the  fuel,  and  increased  the 
power  one-fourth,  thus  making  every  pound  of  coal  produce  five 
times  the  force  formerly  obtained  from  it."  l  But  Watt  was  not 
satisfied  with  this  single  improvement.  He  introduced  steam 
above  as  well  as  below  the  piston,  and  thus  again  increased  the 
power  of  the  machine.  He  discovered  the  principle  of  parallel 
motion,  and  thus  made  the  piston  move  in  a  true  straight  line. 
He  regulated  the  supply  of  water  to  the  boiler  by  the  means  of 

JLord  Brougham's  "  Men  of  Letters  and  Science,"  p.  367. 


THE   GREAT   INVENTIONS.  47 

"  floats,"  the  supply  of  steam  to  the  cylinder  by  the  application 
of"  the  governor,"  and,  by  the  addition  of  all  these  discoveries, 
"  satisfied  himself  that  he  had  almost  created  a  new  engine,  of 
incalculable  power,  universal  application,  and  inestimable 
value."  1  It  is  unnecessary  to  relate  in  these  pages  the  gradual 
introduction  of  the  new  machine  to  the  manufacturing  public. 
Watt  was  first  connected  with  Dr.  Roe'buck,  an  iron-master  of 
Glasgow.  But  his  name  is  permanently  associated  with  that  of 
Mr.  Boulton,  the  proprietor  of  the  Soho  Works  near  Birmingham, 
whose  partner  he  became  in  1774.  Watt  and  Boulton  rapidly 
supplemented  the  original  invention  with  further  improvements. 
Other  inventors  succeeded  in  the  same  field,  and,  by  the  begin- 
ning of  the  present  century,  steam  was  established  as  a  new  force  ; 
advanced  thinkers  were  considering  the  possibility  of  applying  it 
to  purposes  of  locomotion. 

The  steam-engine  indeed  would  not  have  been  invented  in  the 
eighteenth  century,  or  would  not  at  any  rate  have  been  discovered 
in  this  country,  if  it  had  not  been  for  the  vast  mineral  wealth 
with  which  Great  Britain  has  fortunately  been  provided.  Iron, 
the  most  useful  of  all  metals,  presents  greater  difficulties  than 
any  other  of  them  to  the  manufacturer,  and  iron  was  probably 
one  of  the  very  last  minerals  which  was  applied  to  the  service  of 
man.  Centuries  elapsed  before  the  rich  mines  of  our  own  coun- 
try were  even  slightly  worked.  The  Romans  indeed  established 
iron  works  in  Gloucestershire,  just  as  they  obtained  tin  from 
Cornwall  or  lead  from  Wales.  But  the  British  did  not  imitate 
the  example  of  their  earliest  conquerors,  and  the  little  iron  which 
was  used  in  this  country  was  imported  from  abroad.  Some 
progress  was,  no  doubt,  made  in  the  southern  counties ;  the 
smelters  naturally  seeking  their  ores  in  those  places  where  wood, 
then  the  only  available  fuel,  was  to  be  found  in  abundance.  The 
railings  which  but  lately  encircled  our  metropolitan  cathedral 
were  cast  in  Sussex.  But  the  prosperity  of  the  trade  involved  its 
own  ruin.  Iron  could  not  be  made  without  large  quantities  of 
fuel.  The  wood  gradually  disappeared  before  the  operations  of 
the  smelter,  and  the  country  gentlemen  hesitated  to  sell  their 
trees  for  fuel  when  the  increase  of  shipping  was  creating  a  grow- 
ing demand  for  timber.  Nor  were  the  country  gentlemen  ani- 
mated in  this  respect  by  purely  selfish  motives.  Parliament 

JLord  Brougham's  "  Men  of  Letters  and  Science,"  p.  371. 


48  SELECTIONS. 

itself  shared  their  apprehensions  and  endorsed  their  views.  It 
regarded  the  constant  destruction  of  timber  with  such  disfavor 
that  it  seriously  contemplated  the  suppression  of  the  iron  trade 
as  the  only  practical  remedy.  "  Many  think,"  said  a  contempo- 
rary writer,  "  that  there  should  be  no  works  anywhere,  thev  so 
devour  the  woods."  1  Fortunately,  so  crucial  a  remedy  was  not 
necessary.  At  the  commencement  of  the  seventeenth  century, 
Dud  Dudley,  a  natural  son  of  Lord  Dudley,  had  proved  the 
feasibility  of  smelting  iron  with  coal ;  but  the  prejudice  and 
ignorance  of  the  work-people  had  prevented  the  adoption  of  his 
invention.  In  the  middle  of  the  eighteenth  century,  attention 
was  again  drawn  to  his  process,  and  the  possibility  of  substitut- 
ing coal  for  wood  was  conclusively  established  at  the  Darby's 
works  at  Coalbrook  Dale.  The  impetus  which  was  thus  given 
to  the  iron  trade  was  extraordinary.  The  total  produce  of  the 
country  amounted  at  the  time  to  only  18,000  tons  of  iron  a  year, 
four-fifths  of  the  iron  used  being  imported  from  Sweden.  In 
1802  Great  Britain  possessed  168  blast-furnaces,  and  produced 
170,000  tons  of  iron  annually.  In  1806  the  produce  had  risen  to 
250,000  tons  ;  it  had  increased  in  1820  to  400,000  tons.  Fifty 
years  afterwards,  or  in  1870,  6,000,000  tons  of  iron  were  pro- 
duced from  British  ores.2 

The  progress  of  the  iron  trade  indicated,  of  course,  a  corre- 
sponding development  of  the  supply  of  coal.  Coal  had  been  used 
in  England  for  domestic  purposes  from  very  early  periods.  Sea  coal 
had  been  brought  to  London  ;  but  the  citizens  had  complained 
that  the  smoke  was  injurious  to  their  health,  and  had  persuaded 
the  legislature  to  forbid  the  use  of  coal  on  sanitary  grounds.  The 
convenience  of  the  new  fuel  triumphed,  however,  over  the  argu- 
ments of  the  sanitarians  and  the  prohibitions  of  the  legislature, 
and  coal  continued  to  be  brought  in  constantly  though  slowly  in- 
creasing quantities  to  London.  Its  use  for  smelting  iron  led  to 
new  contrivances  for  ensuring  its  economical  production.  Before 
the  commencement  of  the  present  century  there  were  two  great 
difficulties  which  interfered  with  the  operations  of  the  miner. 
The  roof  of  the  mine  had  necessarily  to  be  propped,  and,  as  no 
one  had  thought  of  using  wood,  and  coal  itself  was  employed  for 
the  purpose,  only  60  per  cent,  of  the  produce  of  each  mine  was 

1  Smiles'  "  Industrial  Biography,"  p.  43. 

*  "Diet.  Hist."  vol.  iv.  p.  689;  McCulloch,  "Diet,  of  Commerce,"  ad  verb.  Iron;  Porter's 
"  Progress  of  the  Nation,"  p.  530;  statistical  abstract  of  the  United  Kingdom. 


THE   GREAT   INVENTIONS.  49 

raised  above  ground.  About  the  beginning  of  the  nineteenth 
century,  timber  struts  were  gradually  substituted  for  the  pillars  of 
coal,  and  it  became  consequently  possible  to  raise  from  the  mine 
all  the  coal  won  by  the  miner.  A  still  more  important  discovery 
was  made  at  the  exact  period  at  which  this  history  commences. 
The  coal-miner  in  his  underground  calling  was  constantly  ex- 
posed to  the  dangers  of  fire-damp,  and  was  liable  to  be  destroyed 
without  a  moment's  notice  by  the  most  fearful  catastrophe.  In 
the  year  in  which  the  great  French  war  was  concluded,  Sir 
Humphrey  Davy  succeeded  in  perfecting  his  safety-lamp,  an  in- 
vention which  enabled  the  most  dangerous  mines  to  be  worked 
with  comparative  safety,  and  thus  augmented  to  an  extraordinary 
extent  the  available  supplies  of  coal.1 

Humphrey  Davy  was  the  son  of  a  wood-carver  of  Penzance, 
and  early  in  life  was  apprenticed  to  a  local  apothecary.  Chance  — 
of  which  other  men  would  perhaps  have  failed  to  avail  them- 
selves—  gave  the  lad  an  opportunity  of  cultivating  his  taste  for 
chemistry.  A  French  surgeon,  wrecked  on  the  coast,  to  whom 
Davy  had  shown  some  kindness,  gave  him  a  case  of  surgical  in- 
struments, and  "  the  means  of  making  some  approximation  to  an 
exhausting  engine."  Watt's  son,  Gregory  Watt,  was  ordered  to 
winter  in  Cornwall  for  his  health,  and  happened  to  take  apart- 
ments in  the  house  of  Davy's  mother.  "  Another  accident  threw 
him  in  the  way  of  Mr.  Davies  Giddy,  a  cultivator  of  natural  as 
well  as  mathematical  science."  Giddy  "  gave  to  Davy  the  use  of 
an  excellent  library  ;"  he  "  introduced  him  to  Dr.  Becldoes,"  who 
made  his  young  friend  the  head  of"  a  pneumatic  institution  for 
the  medical  use  of  gases,"  which  he  was  then  forming.  The 
publication,  soon  afterwards,  of  a  fanciful  paper  on  light  and  heat 
gave  Davy  a  considerable  reputation.  He  was  successively 
chosen  assistant  lecturer  in  chemistry,  and  sole  chemical  professor 
of  the  Royal  Institution.  While  he  held  this  office  his  inquiries 
induced  him  to  investigate  the  causes  of  the  fearful  explosions 
which  continually  took  place  in  coal  mines.  He  soon  satisfied 
himself  that  carburetted  hydrogen  is  the  cause  of  fire-damp  ;  and 
that  it  will  not  explode  unless  mixed  with  atmospheric  air  "  in 
proportions  between  six  and  fourteen  times  its  bulk  ;  "  and  "  he 
was  surprised  to  observe  in  the  course  of  his  experiments,  made 
for  ascertaining  how  the  inflammation  takes  place,  that  the  flames 

1  Porter's  "  Progress  of  the  Nation,"  p.  277;  McCulloch,  ad  verb.  Coal. 


50  SELECTIONS. 

will  not  pass  through  tubes  of  a  certain  length  and  smallness 
of  bore.  He  then  found  that,  if  the  length  be  diminished  and  the 
bore  also  reduced,  the  flames  will  not  pass  ;  and  he  further  found 
that,  by  multiplying  the  number  of  the  tubes,  this  length  may  be 
safely  diminished  provided  the  bore  be  proportionally  lessened. 
Hence  it  appeared  that  gauze  of  wire,  whose  meshes  were  only 
one  twenty-second  of  an  inch  in  diameter,  stopped  the  flame  and 
prevented  the  explosion."1  These  successive  discoveries,  the 
results  of  repeated  experiments  and  careful  thought,  led  to  the 
invention  of  the  safety-lamp.  The  first  safety-lamp  was  made  in 
the  year  1815.  There  is  some  satisfaction  in  reflecting  that  the 
very  year  which  was  memorable  for  the  conclusion  of  the  longest 
and  most  destructive  of  modern  wars,  was  also  remarkable  for 
one  of  the  most  beneficial  discoveries  which  have  ever  been  given 
to  mankind.  Even  the  peace  of  Paris  did  not  probably  save  more 
life  or  avert  more  suffering  than  Sir  Humphrey  Davy's  invention. 
The  gratitude  of  a  nation  properly  bestowed  titles  and  pensions, 
lands  and  houses,  stars  and  honors,  on  the  conqueror  of  Napoleon. 
Custom  and  precedent  only  allowed  inferior  rewards  to  the  in- 
ventor of  the  safety-lamp.  Yet  Hargreaves  and  Arkwright, 
Crompton  and  Cartwright,  Watt  and  Davy,  did  more  for  the 
cause  of  mankind  than  even  Wellington.  Their  lives  had  more 
influence  on  their  country's  future  than  the  career  of  the  great 
general.  His  victories  secured  his  country  peace  for  rather  more 
than  a  generation.  Their  inventions  gave  Great  Britain  a  com- 
mercial supremacy,  which  neither  war  nor  foreign  competition 
has  yet  destroyed. 

A  series  of  extraordinary  inventions,  at  the  commencement  of 
the  present  century,  had  supplied  Great  Britain  with  a  new 
manufacturing  vigor.  Hargreaves,  Arkwright,  Crompton,  and 
Cartwright  had  developed,  to  a  remarkable  degree,  the  produc- 
ing power  of  man  ;  Watt  had  given  a  new  significance  to  their 
inventions  by  superseding  the  feeble  and  unequal  forces,  which 
had  hitherto  been  used,  with  the  most  tractable  and  powerful  of 
agents.  And  Davy,  by  his  beneficent  contrivance,  had  enabled 
coal  to  be  won  with  less  danger,  and  had  relieved  the  miner's 
life  from  one  of  its  most  hideous  perils.  The  ingenuity  of  these 
great  men  had  been  exercised  with  different  objects ;  but  the 
inventions  of  each  of  them  had  given  fresh  importance  to  the 

1  See  Brougham's  "  Men  of  Letters  and  Science,"  p.  462.    The  life  of  Davy  is  admirably 
told  by  Lord  Brougham. 


THE   GREAT   INVENTIONS.  51 

discoveries  of  the  others.  The  spinning-jenny,  the  water-frame, 
and  the  mule  would  have  been  deprived  of  half  their  value,  if 
they  had  not  been  supplemented  with  the  power-loom  ;  the 
power-loom  would,  in  many  places,  have  been  useless  without 
the  steam-engine  ;  the  steam-engine  would  have  been  idle,  had 
it  not  been  for  coal ;  the  coal  would  not  have  been  won  with- 
out danger,  had  it  not  been  for  Sir  H.  Davy.  Coal,  then,  was 
the  commodity  whose  extended  use  was  gradually  revolution- 
izing the  world  ;  and  the  population  of  the  world,  as  the  first 
consequence  of  the  change,  gradually  moved  towards  the  coal 
fields.  The  change  was  just  commencing  at  the  beginning  of 
the  present  century  ;  it  was  proceeding  with  rapid  strides  at  the 
period  at  which  this  history  opens  ;•  its  ultimate  effects  will  be 
seen  later  on  in  this  work.  The  time  was  to  come  when  the 
coal  measures  of  England  were  to  draw  away  the  population  of 
Ireland ;  to  weaken  the  power  of  the  southern  agricultural 
counties;  to  give  predominance  to  the  north  of  England  ;  and  by 
these  results  to  involve  a  political  revolution. 


52  SELECTIONS. 

IV. 

ECONOMIC    CAUSES    OF    THE    FRENCH    REVOLUTION. 
FROM  VON  SYBEL'S  FRENCH  REVOLUTION,  VOL.  I.,  pp.  21-53. 

IN  order  to  bring  this  matter,  in  its  details,  more  clearly  before 
us,  we  may  pass  in  review  the  thre.e  great  classes  into  which  the 
French  people  were  divided  according  to  their  occupation.1  By 
far  the  most  important  of  these  occupations,  at  that  period,  was 
agriculture.  Nearly  21,000,000  out  of  25,000,000  of  inhab- 
itants were  employed  in  tilling  the  soil.  Of  the  51,000,000 
hectares  of  which  the  whole  kingdom  is  composed,  35,000,- 
ooo  were  destined  for  cultivation,  that  is,  rather  less  than  at 
the  present  day,  but  more  than  twice  as  much  as  is  now  under 
cultivation  in  England.  It  has  often  been  imagined  that  the 
property  of  these  great  masses  of  land  was  almost  entirely  in  the 
hands  of  the  church,  the  monasteries,  the  nobility,  and  the  finan- 
ciers;  and  that  before  1789  only  large  estates  existed,  while  the 
class  of  small  proprietors  was  created  by  the  Revolution.  Some 
consider  this  supposed  change  as  the  highest  glory,  and  others 
as  the  greatest  calamity  of  modern  times  ;  but  all  are  agreed  as 
to  the  fact,  and  the  more  so,  because  it  was  continually  pro- 
claimed in  the  debates  of  the  revolutionary  assemblies.  But,  on 
closer  examination,  we  shall  find  that  the  effects  of  the  feudal  sys- 
tem upon  agriculture  are  not  to  be  looked  for  in  this  direction. 
We  cannot  rank  the  authority  of  the  revolutionary  orators  very 
high,  both  because  they  had  a  political  interest  in  breaking  up 
the  large  estates  for  the  advantage  of  the  city  proletaries,  and 
because  they  always  showed  themselves  fabulously  ignorant  of 
statistics.  If  we  examine  the  state  of  things  before  1789,  we 
shall  find  that  —  apart  from  the  feudal  tenures  and  the  church 
property  —  even  the  old  French  law  of  inheritance  by  no  means 
favored  the  accumulation  of  estates.  The  nobility,  indeed,  were 
often  heard  to  complain  that  the  roturicrs  were  constantly  get- 

1  In  drawing  up  the  following  statement  we  have  chiefly  consulted  the  "  Statistique  min- 
istericlle  de  la  France,"  and  the  admirable  works  of  Moreau  de  Yonne;  and  also  Lavergne, 
"feconomie  rurale."  The  latter  gives  much  information  respecting  the  earlier  state  of 
things,  which  now  and  then,  however,  requires  examination  and  correction. 


CAUSES  OF  THE  FRENCH  REVOLUTION.        53 

ting  possession  of  land  ;  which  is  intelligible  enough,  since  the 
moneyed  classes  were  continually  gaining  ground  on  the  ancient 
aristocracy.  It  follows  that  there  was  nothing  in  the  circum- 
stances of  the  age  to  render  the  division  of  land  impossible  ;  and 
one  of  the  most  credible  witnesses,  after  three  years'  investigation 
in  all  the  French  provinces,  tells  us,  as  the  result  of  his  observa- 
tions, that  about  a  third  of  the  land  was  held  by  small  proprietors, 
who  were  sufficiently  prosperous  in  Flanders,  Alsace,  Beam,  and 
the  north  of  Bretagne  ;  but  in  other  parts,  especially  in  Lorraine 
and  Champagne,  poor  and  miserable.  The  division  of  property, 
he  observes,  is  carried  to  too  great  an  extent;  "I  have  fre- 
quently seen  properties  of  ten  roods  with  a  single  fruit-tree ; 
excessive  division  ought  to  be  forbidden  by  law." 

The  witness  is  Arthur  Young,  one  of  the  first  agriculturists  of 
the  period  in  Europe,  who  gave  this  testimony  after  indefatigable 
inquiry  ;  and  his  report  is  confirmed  by  native  authorities. 

"The  subdivision  of  land,"  says  Turgot,  "is  carried  to  such 
an  extent,  that  a  property,  only  just  sufficient  for  one  family,  is 
divided  among  five  or  six  children."  "  The  landed  estates," 
writes  an  intendant,  "  are  broken  up  systematically  to  a  very 
alarming  degree  ;  the  fields  are  divided  and  subdivided  ad  injini- 
tum"  Such  was  the  case  among  the  small  proprietors ; 1  the 
other  two-thirds  of  the  soil  was  entirely  in  the  possession  of  the 
great  land-owners  —  consisting  partly  of  the  nobility  and  clergy, 
and  partly  of  magistrates  and  financiers.  We  shall  presently  in- 
quire, in  what  manner  they  turned  their  lands  to  profit ;  but  we 
may  first  of  all  observe  that  a  middle  class  of  proprietors,  sub- 
stantial enough  to  derive  from  their  land  a  sufficient  livelihood, 
and  yet  humble  enough  to  be  bound  to  constant  and  diligent 
labor,  was  entirely  wanting.  In  the  present  dav  the  landed 
proprietors  of  France  may  be  divided  into  three  sections,  each  of 
which  possesses  about  one-third  of  the  productive  soil  of  the 
country.  Eighteen  million  hectares  belong  to  183,000  great 
landed  owners  ;  fourteen  millions  to  700,000  proprietors  of  the 
middle  class,  and  fourteen  millions  to  not  quite  four  millions  of 
peasant  owners.2  When  we  compare  these  figures  with  those  of 
the  pre-revolutionary  period,  we  find  the  number  of  poor  posses- 
sors exactly  corresponding  to  one  another ;  and,  what  is  very  re- 

1  Quoted  by  Tocqueville,  "  L"  Ancien  Regime,"  60. 

-  Cochut,  "  Revue  tie  Deux  Mondes,"  Sept.,  1848;  Rossi,  "  Economic  politique,"  p.  325, 
et  seq. 


54  SELECTIONS. 

markable,  they  are  almost  exactly  the  same  in  1831  as  in  1815. 
The  most  fearful  storms  pass  over  the  surface  of  the  land  without 
producing  any  change  in  these  relations.  But  what  the  movement 
Of  ^89  —  the  emancipation  of  the  soil,  and  civil  equality — did 
produce,  is  this  middle  class  of  proprietors,  which  now  possesses 
one-third  of  the  land.  It  must  be  confessed  that  this  is  a  most 
remarkable  result.  How  often  has  it  been  announced  by  feudal- 
ists and  socialists,  that  entire  freedom  of  trade  would  inevita- 
bly lead  to  the  annihilation  of  the  middle  classes,  and  leave 
nothing  but  millionnaires  and  proletaries  !  We  here  see  the  very 
contrary  proved  by  one  of  the  grandest  historical  facts.  The 
feudal  system,  by  its  restrictions,  crushed  the  agricultural  middle 
class ;  the  rule  of  freedom  created  it  afresh.  Let  us,  however, 
consider  the  position  of  these  lords  of  the  soil  and  their  depend- 
ents more  closely. 

The  first  fact  which  meets  us  in  this  investigation  is  an  un- 
happy one.  It  was  only  an  excessively  small  minority  of  the 
great  land-owners  who  concerned  themselves  about  their  estates 
and  tenants.  All  who  were  at  all  able  to  do  so  hurried  awray  to 
the  enjoyments  of  the  court  or  the  capital,  and  only  returned  to 
their  properties  to  fill  the  purse  which  had  been  emptied  by 
their  excesses.  There  they  lived  in  miserly  and  shabby  retire- 
ment ;  sometimes  in  wretchedly  furnished  castles,  shunned  by  the 
peasants  as  pitiless  creditoi's ;  sometimes  in  the  midst  of  forests 
and  wastes,  that  they  might  have  the  pleasures  of  the  chase  close 
at  hand.  They  took  as  little  interest  in  intellectual  subjects  as  in 
agricultural  affairs,  and  cherished  little  or  no  intercourse  with 
their  neighbors ;  partly  from  parsimony,  and  partly  from  the 
entire  want  of  local  roads.  When  the  period  of  fasting  was 
over,  they  rushed  eagerly  back  to  the  alluring  banquets  of  Paris 
and  Versailles.  The  number  of  exceptions  to  this  melancholy 
rule  was  so  small  as  to  exercise  no  influence  on  the  general  con- 
dition of  the  country. 

While  these  gentlemen  were  squandering  the  produce  of  their 
estates  in  aristocratic  splendor,  their  fields  were  let  out  in  parcels 
often  or,  at  most,  fifteen  hectares,  to  the  so-called  metayers,  who 
did  not  pay  a  fixed  rent,  but  generally  half  the  gross  produce, 
and  received  from  the  owner,  in  return,  their  first  seed-corn,  their 
cattle,  and  agricultural  implements.1  This  system  yielded  a 

1  Quesnay  in  Daire,  "  Physiocrates,"p.2i9,et  seq.;  Young's  "Travels,"  II.  190;  Lullin 
de  Chateauvieux,  I.  270. 


CAUSES  OF  THE  FRENCH  REVOLUTION.        55 

wretched  existence  for  the  tenants  themselves,  and  reduced  the 
estates  to  a  miserable  condition,  but  it  brought  the  owners  a  large 
though  uncertain  income.  The  latter,  who  only  saw  their  estates 
as  travellers,  were  accustomed  to  farm  out  the  collection  of  their 
dues,  generally  to  a  notary  or  an  advocate,  who  treated  the 
tenants  with  merciless  severity. 

The  peasants,  in  their  turn,  neglected  the  cultivation  of  corn  — 
of  which  they  had  to  give  up  a  moiety  —  for  any  chance  occupa- 
tion, the  whole  profit  of  which  fell  to  themselves ;  they  used  their 
oxen  rather  for  purposes  of  transport  than  for  ploughing,  fat- 
tened their  geese  in  their  own  wlieat  fields,  and,  above  all, 
introduced  the  system  of  alternating  crop  and  fallow,  in  order 
to  get  a  greater  extent  of  pasture,  and  consequently  a  larger 
number  of  cattle.  This  was  a  personal  gain  to  themselves,  but 
evidently  brought  no  advantage  to  the  estate.  A  system  of  til- 
lage, in  short,  prevailed  without  industry,  without  science,  and, 
above  all,  without  capital.  It  has  been  calculated  that  the  aver- 
age amount  of  capital  employed  at  that  period  in  the  French 
metairies,  was  from  40  to  60  francs  to  the  hectare;  while  in 
England,  at  the  same  time,  the  average  amounted  to  240  francs.1 
The  result  was,  of  course,  a  wretched  one  ;  they  only  reckoned 
upon  a  crop  from  seven  to  eight  hectolitres  of  wheat  to  the  hec- 
tare,—  the  increase  being  from  five  to  six  fold  ;  while  the  English 
farmer  of  that  time  obtained  a  twelve-fold  increase.  It  was  impos- 
sible for  the  peasant  under  such  circumstances  to  gain  a  livelihood  ; 
the  produce  often  hectares  was  scarcely  sufficient  to  support  his 
family,  and  sale  and  profit  were  out  of  the  question.  The  man  who 
is  thus  condemned  to  pass  his  life  in  starvation,  soon  learns  to  fold 
his  hands  in  idleness.  A  constantly  increasing  extent  of  country 
lay  uncultivated,  which  Quesnay,  in  1750,  estimated  at  a  quarter 
of  the  arable  land  of  France,  and  Arthur  Young,  in  1790,  at  more 
than  9,000,000  hectares.  Millions  of  rural  dwellings  had  no  aper- 
ture in  them  but  the  door,  or  at  most  one  window  ; 2  the  people 
had  no  clothing  but  a  home-made,  coarse,  and  yet  not  thick, 
woollen  cloth  ;  in  many  provinces  every  one  went  barefoot,  and 
in  others  only  wooden  shoes  were  known.  The  food  of  the  peo- 
ple was  gruel  with  a  little  lard  ;  in  the  evening  a  piece  of  bread, 
and  on  great  occasions  a  little  bacon  ;  but,  besides  this,  no  meat 

1  Arthur  Young,  II.  249.    The  elder  Mirabeau  reckons  for  the  whole  of  France,  66  francs 
to  the  arpetil. 

2  This  is  still  the  case. 


56  SELECTIONS. 

for  months  together,  and  in  many  districts  no  wine  at  all.1  The 
mental  condition  of  the  people  was  in  accordance  with  their 
external  circumstances.  Books  and  newspapers  were  as  little 
known  in  the  villages  as  reading  and  writing.  The  peasants  de- 
pended for  instructions  on  their  pastors  and  parish  clerks,  prole- 
taries like  themselves,  who  very  seldom  got  beyond  the  horizon 
of  the  church  steeple.  The  Church  was,  after  all,  the  only  insti- 
tution that  threw  an  intellectual  spark  into  their  wretched  life  ; 
but  unfortunately  their  religious  impulses  were  strongly  mixed 
with  barbarism  and  superstition.  In  many  large  districts  of  the 
south  the  peasants  had  no  other  idea  of  a  Protestant  than  as  of 
a  dangerous  magician  who  ought  to  be  knocked  on  the  head. 
Their  own  faith,  moreover,  was  interwoven  with  a  multitude  of  the 
strangest  images  of  old  Celtic  heathenism.  Of  the  world  outside 
they  heard  nothing,  for  there  was  next  to  no  traffic  or  travelling 
in  the  country.  There  were  some  royal  roads,  magnificently 
made,  and  sixty  feet  in  breadth  —  splendid  monuments  of  mo- 
narchical ostentation.  On  these,  however,  up  to  i77°^  on^y  two 
small  coaches  ran,2  throughout  the  whole  of  France  ;  and  the  trav- 
eller might  pass  whole  days  without  getting  sight  of  any  other 
vehicle.3  Only  few  villages,  in  the  most  favored  provinces,  pos- 
sessed cross-roads  to  these  great  highways,  or  to  the  nearest  market 
town.  And  thus  the  whole  existence  of  these  people  was  passed 
in  toil  and  privation  ;  without  any  pleasures  except  the  sight  of 
the  gaudy  decorations  of  a  few  church  festivals ;  without  any 
change,  save  when  hunger  drove  an  individual,  here  and  there, 
to  seek  day-labor  in  the  towns,  or  into  military  service.  It  was 
seldom  that  such  a  one  ever  returned  to  his  father's  house,  so  that 
his  fellow-villagers  gained  no  advantage  from  his  wider  experi- 
ence. 

Under  these  circumstances  the  relation  between  peasant  and 
lord  was  naturally  a  deplorable  one.  What  we  have  already  said, 
sufficiently  characterizes  a  community,  in  which  all  the  enjoy- 
ments fell  to  the  rich,  and  all  the  burdens  were  heaped  upon 
the  poor.  In  aristocratic  England  at  this  period,  a  quarter  of  the 
gross  proceeds  was  considered  a  high  rent  for  a  farm,  and  the 
owner,  moreover,  paid  large  tithes  and  poor-rates.4  In  France, 


1  Reports  of  the  Prefects  to  the  Ministry,  1803. 

*  E.  Daire,  "  Introduction  aux  CEuvres  de  Turgot.' 

» Young's  "Travels." 

«Yvernois,  "Tableau  des  Pertes,"  etc. 


CAUSES  OF  THE  FRENCH  REVOLUTION.        57 

half  the  proceeds  was  the  usual  rent ;  and  the  owners  were  ex- 
empted by  their  privileges  from  many  public  burdens,  which  fell 
with  double  weight  upon  the  wretched  metayers.  Thus,  the 
produce  of  the  French  land,  as  compared  with  the  English, 
was  nine  to  fourteen,  while  the  rents  of  an  English  land-owner 
were  at  the  rate  of  two  and  three-fourths  per  cent.,  and  those  of 
the  French  land-owner  three  and  three-fourths  per  cent.1 

The  deficiency  in  the  product  of  the  land,  therefore,  affected 
the  gains  of  the  little  farmer  doubly.  In  addition  to  this  he  wras 
burdened  by  a  number  of  feudal  services,  by  forced  labor  on  the 
lands  of  his  lord,  by  tithes  to  the  church,  and  by  the  obligation 
to  make  roads  for  the  State.  The  landlord  who  tried  to  sell  his 
rent  in  kind  as  dearly  as  possible,  wished  for  high  prices  of  corn  ; 
the  peasant,  who,  after  paying  his  dues,  did  not  raise  enough  for 
his  own  family,  longed,  like  the  city  proletary,  for  low  prices. 
In  short,  these  two  classes,  so  intimately  connected  with  one  an- 
other, had  nothing  at  all  in  common  ;  in  education,  in  interests 
and  enjoyments,  they  were  as  widely  separated  as  the  inhabitants 
of  different  quarters  of  the  globe,  and  regarded  each  other 
respectivelv  with  contempt  and  hatred.  When  the  peasant  looked 
upon  the  towers  of  his  lord's  castle,  the  dearest  wish  of  his  heart 
was  to  burn  it  down,  with  all  its  registers  of  debt.  Here  and 
there  a  better  state  of  things  existed  ;  but  we  can  only  bring  for- 
ward two  exceptions  to  the  melancholy  rule,  extending  over  large 
tracts  of  country.  In  Anjou  the  system  of  metairie  prevailed  as 
in  Lower  Bretagne  and  Guienne  ;  and  yet  in  the  former  province, 
the  peasants  were  prosperous,  and  the  noblemen  beloved.  Lower 
Poitou  was  the  only  province  from  which  the  nobles  had  not 
allowed  themselves  to  be  enticed  into  the  whirlpool  of  court  life. 
The  nobleman  dwelt  in  his  own  castle,  the  real  lord  of  his 
domains,  the  cultivator  of  his  fields,  the  guardian  of  his  peasants. 
He  advanced  them  money  to  purchase  the  necessary  stock,  and 
instructed  them  in  the  management  of  their  cattle  ;  *  the  expul- 
sion of  a  tenant  was  a  thing  unheard  of;  the  laborer  was  born  on 
the  estate,  and  the  landlord  was  the  godfather  of  all  his  farmers' 
children.  He  was  often  seen  going  to  market  with  his  peasants, 
to  sell  their  oxen  for  them  as  advantageously  as  possible.  His 
mental  horizon,  however,  did  not  extend  beyond  these  honorable 
cares  ;  he  honored  God  and  the  King,  labored  in  his  own  fields, 

1  Young. 

2  Sauvegrain,  "Considerations  sur  la  Population,"  etc.     Paris,  :So6. 


58  SELECTIONS. 

was  a  good  sportsman  and   toper,  and  knew  as  little  of  the  world 
and  its  civilization  as  his  tenants. 

In  the  north  of  the  kingdom  a  more  modern  state  of  things 
had  grown  up.  There,  wealthy  farmers  were  to  be  seen,  who 
held  their  land  on  lease  at  a  fixed  money  rental,  —  which  was 
settled  according  to  the  amount  of  the  taxes  to  which  they  were 
liable, — and  who  brought  both  skill  and  capital  to  the  manage- 
ment of  their  land.  This  was  the  regular  practice  in  Flanders, 
Artois,  Picardy,  Normandy,  the  Isle  of  France,  and  other 
smaller  districts.  In  these  parts  the  landlords  had  a  certain 
revenue,  and  their  land  yielded  twice  as  much  as  that  which 
was  in  the  hands  of  the  metayers.  The  whole  country  wore  the 
appearance  of  a  garden,  and  the  poorer  neighbors  found  lucrative 
employment  at  the  stately  farm-houses.  These  were  the  same 
provinces  in  which  Arthur  Young  met  with  small  proprietors  in 
a  tolerable  condition.  If  a  peasant  in  this  part  of  the  country 
possessed  a  small  strip  of  land  near  his  cottage,  large  enough  to 
grow  some  vegetables,  food  for  a  goat,  or  a  few  vines,  he  earned 
sufficient  to  supply  the  rest  of  his  wants,  in  day  wages  from  the 
farmers,  or,  as^a  weaver,  from  the  neighboring  manufacturers. 

His  was  a  condition  similar  to  the  normal  one  of  the  peasant 
proprietors  in  France  at  the  present  day ;  who  are  not  reduced 
farmers,  but  laborers  who  have  invested  their  savings  in  land.1 
It  was  more  difficult  for  these  people  to  make  a  livelihood  at  that 
time  than  now,  because  there  were  fewer  manufacturers  and 
wealthy  agriculturists.  Except  in  the  above-mentioned  provinces, 
these  petty  proprietors  were  equally  wretched  and  hopeless  with 
the  metayers,  by  whom  they  were  surrounded  ;  their  only  object 
was  to  rent  a  metairie  in  addition  to  their  own  pittance  of  land. 
They  were  in  fact  entirely  lost  sight  of  among  the  metayers-,  and 
this  is  the  reason  that  French  writers,  in  their  descriptions  of  the 
so-called  petite  culture  (plot  farming),  never  make  any  special 
mention  of  them,  but  always  confound  them  with  the  more 
numerous  class  by  which  they  were  surrounded.  All  authorities 
are  agreed  in  estimating  the  amount  of  land  cultivated  in  small 
parcels,  at  27,000,000  hectares,  while  only  9,000,000  were  held 
at  a  money  rent.  The  former,  therefore,  was  nearly  equally 
divided  between  the  small  owners  and  the  metayers,  who  paid 
their  rent  in  kind. 

1  Rossi,  1.  c. 


CAUSES  OF  THE  FRENCH  REVOLUTION.        59 

In  France,  at  the  present  day,  nearly  23,000,000  hectares 
are  cultivated  by  small  proprietors  and  metayers;  about  8,000,- 
ooo1  (the  same  as  in  1780)  by  tenants  paying  a  money  rent, 
and  rather  more  than  nine  and  a  half  millions,  by  wealthy 
landlords.2  Hence  we  can  clearly  see  what  the  French  Revo- 
lution has  done  for  French  agriculture.  Not  only  did  it  create 
the  middle  class  of  land-owners,  but  greatly  promoted  a  more 
rational  system  of  tillage.  About  four  million  hectares  have  been 
rescued  from  the  petite  culture,  and  an  equal  number  redeemed 
from  utter  barrenness.  The  breadth  of  land  standing  at  a  money 
rent  is  exactly  the  same  as  before  the  Revolution.  The  increase 
is  entirely  in  the  properties  of  rich  or  substantial  land-owners,  who 
manage  their  own  estates,  —  which  indicates  a  change  to  more 
zealous  industry,  coupled  with  the  employment  of  greater  capi- 
tal. The  extent  occupied  by  the  metayers  is  still  very  great,  and 
the  condition  of  those  who  are  subject  to  it  but  little  improved, 
notwithstanding  the  abolition  of  socage  and  seigniorial  rights.  It 
will  be  one  of  our  most  important  tasks  to  examine  the  several 
events  and  tendencies  of  the  Revolution,  in  relation  to  their  effects 
on  the  rural  population. 

If  we  turn  our  attention  to  the  towns  of  ancient  France  we 
find  that  similar  causes  produced  effects  corresponding  to  those 
we  have  just  described.  The  civic  offices,  to  which  persons  had 
formerly  been  elected  by  the  districts  or  the  guilds,  had  been 
frequently  filled  up  by  the  crown  in  the  lyth  century  ;  and  in  the 
1 8th,  the  great  majority  of  them  were  sold  in  hereditary  posses- 
sion to  fill  the  exchequer.3  The  government  of  the  towns,  there- 
fore, was  in  the  hands  of  a  close  corporation  consisting  of  a  few 
families,  who,  generally  speaking,  allowed  themselves  to  be  in- 
fected with  the  indolent  and  self-seeking  spirit  of  the  central  gov- 
ernment. Associated  with  these  were  the  families  of  the  moneyed 
aristocracy,  the  members  of  the  great  financial  companies,  the 
farmers  of  the  indirect,  and  the  collectors  of  the  direct,  taxes,  the 
shareholders  of  the  trading  monopolies,  and  the  great  bankers. 
These  circles,  too,  were  either  legally  or  virtually  closed  to  the 
general  world.  The  bourse  was  ruled  by  an  aristocracy,  to 
which  only  birth,  or  the  permission  of  government,  could  give 


1  Quesnai,  Turgot,  Young. 

2  On  this  point  Lullinde,  Chateauvieux,  and  Cochutare  in  the  main  agreed.    Lavergens' 
figures  are  somewhat  different,  but  the  general  result  is  the  same. 

3  Depping,  "  Correspondence  administrative  de  Louis  XIV.,"  Vol.  II.,  Introduction. 


60  SELECTIONS. 

access.  Their  activity  was  of  course  necessarily  centred  in  Paris. 
Indeed,  they  stamped  their  own  character  on  this  city  to  a  degree 
which  would  be  impossible  in  our  age,  notorious  though  it  be  as 
the  epoch  of  the  rule  of  paper.  Every  one  knows  to  what  a 
dizzy  and  ruinous  height  stock-jobbing  was  carried  by  law,  in 
the  beginning  of  the  century ;  and  from  that  time  forward  its 
operations  were  never  suspended,  and  all  who  had  wealth  or 
credit  engaged  in  it  with  reckless  greediness.  Kings,  nobles, 
ministers,  clergy,  and  parliaments,  one  and  all,  took  part  in  these 
transactions ;  and  the  chronic  deficit,  and  increasing  debts,  of  the 
treasury  afforded  constant  opportunities  of  involving  the  State, 
and  making  a  profit  out  of  its  embarrassments.  We  may  con- 
fidently assert  that,  as  compared  with  the  present  day,  the 
speculative  swindling  of  that  age  was  as  prevalent  and  as  shame- 
less as  its  immorality.  Paris  was  not  at  that  time  a  manu- 
facturing town,  and  its  wholesale  trade  was  insignificant ;  with 
few  exceptions,  therefore,  the  industry  of  the  city  consisted  in 
retail  trade  and  the  negotiation  of  bills  of  exchange.  It  is  not 
the  least  characteristic  feature  of  the  indolent  and  selfish  licen- 
tiousness, into  which  the  higher  classes  of  a  great  nation  had 
fallen,  that  of  all  securities,  life  annuities  were  most  in  favor;  by 
means  of  which  the  purchaser  procured  high  interest  for  himself, 
while  he  robbed  his  children  of  the  capital. 

The  trade  and  commerce  of  the  whole  empire  was  fettered  by 
the  restrictions  of  guilds  and  corporations.  The  principles  on 
which  they  were  conducted  dated  from  Henry  III.,  who  was  the 
first  to  promulgate  the  proposition  that  the  king  alone  can  grant 
the  right  to  labor,  —  a  maxim  which  contains  the  whole  doctrine 
of  the  socialists  from  a  monarchical  point  of  view.  The  masters 
of  every  handicraft  managed  its  internal  affairs,  allowed  no  one 
to  practise  it  who  did  not  belong  to  their  guild,  and  admitted  no 
one  to  their  privileges,  until  he  had  passed  an  examination  of  his 
qualification  before  themselves.  Originally  many  trades  were 
free  from  this  organization,  until  these  too  were  injuriously 
affected  by  the  financial  necessities  of  the  State  ;  when  the  exclu- 
sive rights  of  a  guild  were  sold  to  the  artisans,  as  their  offices 
were  to  the  judges.  The  government  soon  further  proceeded  to 
divide  each  trade  into  several  guilds,  and  made  an  exclusive  cor- 
poration of  the  most  insignificant  occupation.  Thus  the  workers 
in  ebony  were  distinguished  from  the  carpenters,  the  sellers  of 
old  clothes  from  the  tailors,  and  the  pastry-cooks  from  the  bakers. 


CAUSES  OF  THE  FRENCH  REVOLUTION.        6 1 

The  fruit-women  and  flower-girls  formed  separate  exclusive  asso- 
ciations, regulated  by  formal  and  binding  statutes.  In  the  guilds 
of  the  seamstresses,  embroiderers,  and  dress-makers,  only  men 
were  admitted  to  the  privileges  of  masters.  A  number  of  these 
statutes,  by  imposing  excessive  fees  and  duties,  rendered  it  doubly 
difficult  for  an  apprentice,  however  capable,  to  obtain  the  rank  of 
master.  Other  enactments  only  admitted  the  sons  of  masters,  or 
the  second  husbands  of  the  widows  of  masters,  to  the  privileges 
of  the  guild.  In  short,  the  power  of  the  State  was  abused  in  the 
most  glaring  manner  for  the  furtherance  of  exclusive  class  in- 
terests. Those  who  did  not  belong  to  this  aristocracy  of  trade, 
could  only  support  themselves  by  the  labor  of  their  hands,  in  a 
state  of  eternal  servitude.  Despair  and  famine  drove  the  peasants 
from  the-  country  into  the  towns,  where  they  found  no  employ- 
ment open  to  them  but  that  of  day-laborers.  The  important 
influence  which  this  system  exercised  over  the  State  was  clearly 
understood,  both  by  the  privileged  and  the  excluded  classes. 
When  Turgot  abolished  the  guilds  in  1776,  the  Parliament  of 
Paris,  the  princes,  peers,  and  doctors,  unanimous!}-  declared  that 
all  Frenchmen  were  divided  into  close  corporations,  the  links  of 
a  mighty  chain  extending  from  the  throne  to  the  meanest  handi- 
craft ;  and  that  this  concatenation  was  indispensable  to  the  exist- 
ence of  the  State  and  of  social  order.  It  was  not  long  before  the 
guilds  were  reestablished  in  accordance  with  this  declaration ;  we 
shall  see  how  the  journeymen  and  apprentices  replied  to  this 
unctuous  manifesto  some  fifteen  years  later. 

The  great  manufacturing  interests  of  the  country  were  confined 
by  the  same  narrow  restrictions.  Since  the  time  of  Colbert,  who 
was  the  real  creator  of  them,  manufactures  had  been  the  darling 
child  of  the  government;  and,  as  is  usually  the  case  with  darling 
children,  had  been  petted  and  tyrannized  over  at  the  same  time. 
When  Colbert  began  his  operations,  France  produced  neither  the 
finer  kinds  of  cloth,  nor  stockings  —  neither  silks  nor  glass  — 
neither  tar  nor  soap.  The  previously  existing  handicraft  —  which 
had  been  for  a  century  in  the  fetters  of  the  guild  —  had  done  so 
little  to  develop  the  native  manufacturing  talent  of  the  country 
that  the  minister  was  obliged  to  introduce  German',  Swedish,  and 
Italian  workmen.  To  secure  a  sale  in  foreign  countries  he  pre- 
scribed with  great  exactness  the  sort  of  fabric  which  he  wished 
to  be  produced  ;  and,  to  prevent  competition  from  without  he 
enacted  a  number  of  prohibitory  and  protective  duties.  Here, 


62  '  SELECTIONS. 

again,  the  power  of  the  State  intruded  itself  into  the  sphere  of 
private  business,  to  the  advantage  of  the  manufacturer  and  the  in- 
jury of  the  consumer.  The  same  system  was  continued  by  his 
successors  with  still  worse  effects,  because  it  was  carried  out  with 
all  the  fickleness  and  irregularity  of  Louis  XV. 's  government.  It 
is  true  that  manufacturers  made  great  progress,  and  increased 
their  annual  products  six-fold,  from  the  time  of  Colbert  to  that  of 
Necker.1  But  the  statutes  became  more  oppressive  every  year  ; 
every  new  invention  and  improvement  was  excluded  by  them  ; 
and  after  1760,  no  legislation  could  keep  pace  with  the  progress 
of  machinery.  Manufacturers,  therefore,  as  is  everywhere  the 
case  under  such  circumstances,  no  longer  adapted  themselves  to 
the  natural  wants  and  capacities  of  men,  but  immediately  took  an 
artificial  and  aristocratic  direction.  During  Colbert's  ministry, 
while  only  60,400  hands  were  employed  in  the  manufacture  of 
wool,  no  less  than  17,300  were  engaged  in  lace-making;  and  a 
hundred  years  later,  while  the  manufacture  of  soap  only  pro- 
duced 18,000,000  of  francs  a  year,  that  of  hair-powder  was  esti- 
mated at  not  less  than  24,000,000.  The  contrast  between  the 
aristocratic  luxury  of  the  rich  and  the  uncleanly  indigence  of 
the  populace  can  hardly  be  more  glaringly  displayed. 

Agriculture  experienced  in  every  way  the  disadvantages  of  a 
system  which  crippled  communication  with  foreign  countries, 
raised  the  price  of  farming  implements,  and  injuriously  affected 
the  home  trade.  In  their  eagerness  to  protect  manufactures  the 
government  had  learned  to  look  on  the  interests  of  agriculture  as 
of  secondary  importance.  They  accustomed  themselves,  like  the 
modern  socialists,  to  apply  the  word  people  exclusively  to  the 
manufacturing  classes  in  the  towns ;  and  though  they  sacrificed 
the  interests  of  the  latter  in  a  thousand  ways  to  the  privileged 
monopolist,  yet  philanthropy  and  love  of  quiet  cooperated  in 
inducing  them  to  supply  the  necessities  of  the  poorer  artisans,  at 
the  cost  of  the  agricultural  population.  As  supplements  to  the 
protective  and  prohibitory  duties  in  favor  of  manufactures  decrees 
were  issued  forbidding  the  exportation  of  corn  and  other  raw 
agricultural  products.  By  these  artifices  the  price  of  the  hecto- 
litre of  wheat,  which  on  the  average  is  at  present  19  to  20 
francs,  was  in  1764  forced  down  to  less  than  8  francs.2  Choi- 
seul  then  opened  the  trade,  and  the  price  rose  to  more  than  15 

1  This  was  the  proportion  in  the  woollen  manufacture. 

»  Melier,  in  loth  vol.  of  the  "  Memoires  de  1' Academic  royale  de  Medicine." 


CAUSES   OF  THE   FRENCH    REVOLUTION.  63 

francs.  A  similar  result  followed  the  same  measure  in  1775, 
during  the  ministry  of  Turgot ;  but  a  return  to  protection  re- 
duced the  price  once  more  to  12^  francs,  until  the  Revolution. 
The  city  artisans  had  tolerably  cheap  bread,  but  nowhere  in 
the  kingdom  were  the  farmers  prosperous.  In  spite  of  the 
most  violent  complaints  from  all  the  provinces  the  cause  of  the 
evil,  and  consequently  the  evil  itself,  remained  unchanged.  The 
government  adhered  to  the  conviction  that  it  was  their  imme- 
diate duty  to  provide  for  the  maintenance  of  the  population  of  the 
towns.  It  seemed  to  them  a  matter  of  course  that  the  State  should 
use  its  political  power  for  the  advantage  of  its  rulers  and  their 
favorites.  No  one  considered  the  remoter  consequences  of  such 
a  principle  ;  no  one  asked  the  question:  "What  if  this  power 
should  fall  into  democratic  hands  ?  " 

Let  us  endeavor  to  obtain  a  general  view  of  the  wealth  of 
France  at  this  period.  From  the  imperfection  of  official  informa- 
tion, the  task  is  a  difficult  one,  and  its  results  uncertain.  Even 
an  approximation  to  the  truth,  however,  will  not  be  without  in- 
terest, since,  in  order  not  to  bring  forward  unmeaning  figures, 
we  shall  constantly  institute  a  comparison  with  the  new  existing 
state  of  things. 

The  well-informed  Tolosan  —  the  only  authority  on  this  sub- 
ject—  estimates  the  total  produce  of  manufactures  at  931  million 
francs  ;  that  of  handicraft  at  60  millions.  At  the  present  day1  the 
manufactures  of  Eastern  France  alone  —  not  reckoning  handicraft 
—  produce  2,282  millions;  the  sum  total  therefore  has  been  at 
least  quadrupled.  At  the  former  period  it  amounted  to  39  francs 
per  head  of  the  whole  population  ;  at  present  we  might  unhesi- 
tatingly place  it  at  more  than  100  per  head.  The  emancipation  of 
the  internal  trade  since  1789  has  not  raised  the  amount  of  prop- 
erty produced,  but  —  what  has  so  often  been  called  in  question  — 
has  favorably  influenced  the  manner  in  which  it  is  distributed. 
The  daily  wages  of  the  manufacturing  laborers  in  1788,  accord- 
ing to  a  rather  high  estimate,  were  for  men  26  sous,  and  for 
women  15.*  They  are  now,  according  to  the  most  numerous 
and  trustworthy  observation,  42  sous  for  men,  and  26  for  women. 
The  daily  wages  of  the  agricultural  laborers,  too,  can  certainly 
not  be  reckoned  at  more  than  15  sous3  for  the  year  1789,  or  less 

1  In  1853.    In  1860  a  total  of  five  milliards  was  reached.    Boiteau,  "  fetat  de  la  France  en 
1789,"  pr.  506. 

2  Boiteau  thinks  19  to  ao  sous. 

3  Lavergne  says  30  sous,  p.  57. 


64  SELECTIONS. 

than  25 '  in  the  present  day.  If  we  further  take  into  account  the 
very  considerable  increase  in  the  number  of  working  days,  — 
arising  from  the  abolition  of  thirty  holidays,  —  we  shall  find  the 
annual  wages  of  the  earlier  period  to  be  little  more  than  half 
what  they  now  are,  viz.,  351  francs  for  the  manufacturing,  and 
157  for  the  agricultural,  laborer,  against  630  and  300  at  the  present 
day.  To  appreciate  the  significance  of  these  results  we  must 
compare  the  prices  of  provisions  at  these  two  periods.  It  ap- 
pears, then,  that  before  1789  bread  was  considered  very  cheap  at 
three  sous  per  pound,  and  it  was  only  in  Paris  that' this  rate  was 
a  common  one  ;  in  the  provinces,  the  price  was  generally  higher. 
In  our  own  times  the  average  price  for  the.  whole  of  France  from 
1820  to  1840  was  17  centimes,  while  at  Paris,  in  1851,  it  was  14 
cents,  —  less,  therefore,  than  the  old  rate  of  3  sous.  This  seems 
out  of  proportion  to  the  price  of  corn  ;  since  the  hectolitre  of 
wheat  in  1780  cost  from  12-13  francs,  and  in  1840  from  19-20. 
This  apparent  incongruity,  however,  is  accounted  for  by  the 
improvement  in  the  method  of  grinding  and  baking,  by  which  a 
third,  or  even  a  half,  more  weight  of  bread  is  now  obtained  from 
the  same  quantity  of  corn  than  in  the  former  period.2  We  find, 
therefore,  that  the  laborer  received  for  his  wages  little  more 
than  half  the  quantity  of  bread  which  the  modern  workman 
can  obtain  for  what  he  earns.  The  same  proportion  holds  good 
in  other  kinds  of  food,  and  in  regard  to  clothing  the  comparison 
is  still  more  unfavorable  to  the  ante-revolutionary  period. 

We  shall  discover  the  determinate  cause  of  these  differences 
when  we  come  to  consider  the  main  wealth  of  the  French  empire, 
—  the  produce  of  the  soil  in  the  widest  sense  of  the  word.  It 
would  carry  us  too  far  if  we  were  to  examine  every  branch  of 
the  subject,  and  discuss  all  the  difficulties  connected  with  it ;  it 
will  be  sufficient  to  dwell  on  a  few  of  the  principal  points  of  in- 
terest. Of  wheat,  the  great  staff  of  life,  the  soil  of  France  pro- 
duced before  the  Revolution  about  40,000,000  hectolitres,  or  167 
litres  per  head  of  the  population ;  and  in  1840,  70,000,000,  or  208 
litres  per  head.  At  the  former  period  the  number  of  cattle  was 
calculated  at  33, 000,000  head,  and  at  the  present  day  3149,000,000  ; 
and  there  is  an  equal  increase  in  the  number  of  the  other  domes- 
tic animals.  The  vineyards  formerly  yielded  27,000,000  hecto- 

1  Before  1789  the  septier  (240  pounds)  of  wheat  yielded  only  180  pounds  of  bread. 
—Moniteur,  12  July,  1792,  supplement. 

3  Young,  "  Assemblee  nationale,"  I5th  Jan.,  1790,  nth  Aug.,  1791. 


CAUSES   OF  THE   FRENCH    REVOLUTION.  65 

litres,  and  at  present  37,000,000,  so  that  the  proportion,  per  head, 
is  at  any  rate  not  lower  than  it  was.1  And  if  we  take  into  con- 
sideration that  a  number  of  useful  agricultural  products  were  at 
that  time  unknown,  that  a  violent  controversy  was  carried  on  about 
the  wholesomeness  of  potatoes,  that  the  forests  were  allowed  to 
run  to  waste  far  more  than  at  the  present  day,2  we  shall  not  be 
astonished  that  the  best  statist  of  modern  France  estimates  the 
vegetable  product  of  the  French  soil  (which  now  exceeds  in  value 
the  sum  of  6.000  millions),  .not  more  than  2,000  millions  at  the 
period  before  the  Revolution.3  The  importance  of  this  fact  is  suffi- 
cientlv  evident;  and  we  may  gain  an  idea  of  the  state  of  the  popu- 
lation before  1789,  by  remembering  that  even  now  the  total 
consumption  of  food  in  France  is  not  greater  in  proportion  to  the 
population  than  in  Prussia,  and  much  less  than  in  England.4 

Respecting  commerce,  the  third  great  branch  of  national 
wealth,  I  have  but  little  to  say.  I  am  not  aware  that  any  statis- 
tical data  exist  of  the  internal  traffic  of  France  before  the  Revo- 
lution ;  it  was,  no  doubt,  smaller  than  at  the  present  day,  in 
consequence  of  the  multitude  of  inland  duties.  And  with  regard 
to  the  foreign  commerce  of  the  earlier  period  we  have  no  means 
of  dividing  the  sum  totals  which  lie  before  us  into  the  value  of 
the  raw  materials,  and  the  cost  of  manufacture,  on  the  one  hand, 
and  the  clear  profits  of  trade  on  the  other.  It  must  suffice  us  to 
gain  a  general  idea  of  the  relation  between  the  two  periods,  from 
the  summary  statement,  that  in  the  custom-house  registers,  im- 
mediately before  the  Revolution,  the  annual  imports  are  stated 
at  576.000,000,  and  the  exports  at  540,000,000  ;  while,  as  early  as 
1836,  the  former  amounted  to  905,000,000,  and  the  latter  to  961,- 
000,000 ;  and  in  1857,  both  imports  and  exports  had  risen  to  a 
value  of  more  than  1,800,000,000.  Taking  all  in  all,  therefore, 
France  under  the  old  monarchy  was  four  times  as  poor  in  manu- 
factures, three  times  as  poor  in  agriculture,  and  more  than  three 
times  as  poor  in  commerce,  as  it  is  in  the  present  day.  We  must 
bear  this  result  well  in  mind  when  we  try  to  form  a  judgment 

1  Moreau  de  Yonne,  from  contemporary  sources.     I .  have  followed  him  because  space 
does  not  allow  me  to  give  my  reasons  for  thinking  a  much  more  unfavorable  state  of  things 
in  1770  highly  probable. 

2  "  Memoire   remis   aux   Notables,    1781;"     Young's    "Travels,"   III.  —  in;    Moreau, 
"  Agriculture,"  366. 

3  The  calculation  of  Young  agrees  with  this.    Tolosan,  Dedeley  d'Agier,  Lavoisier,  make 
amounts  higher.    (Boiteau,  "Etat  de  la  France  en  1789,"  p.  481,  compares  their  statements) . 
But  the  uncertainty  of  their  calculations  is  very  perceptible. 

4  Communications  from  the  Prussian  Statistical  Bureaus,  1851. 


66  SELECTIONS. 

respecting  the  finances  of  the  ancien  regime.  A  budget  of  600 
millions  weighed  as  heavily  upon  the  resources  of  the  country  at 
that  period,  as  a  budget  of  1,800,000,000  would  now;  and,  con- 
sequently, a  deficit  of  100,000,000  was  equivalent  to  one  of  300,- 
000,000  in  our  own  times.  Such  a  deficit  actually  existed  when 
Louis  XVI.  mounted  the  throne  ;  it  is  therefore  easy  to  conceive 
that  his  attention  should  be  strongly  turned  to  the  restoration  of 
the  balance  between  income  and  expenditure,  and  that  his  vain 
endeavors  in  this  direction  should  shake  the  fabric  of  the  State  to 
its  very  foundation. 

A  whole  volume  would  be  necessary  to  detail  the  different 
schemes  of  reform,  which  were  brought  forward  between  the 
accession  of  Louis  XVI.  and  the  outbreak  of  the  Revolution. 
It  will  be  sufficient  for  our  purpose  to  notice  the  chief  points, 
which  have  an  important  bearing  on  the  antecedents  and  the 
actual  events  of  that  mighty  movement. 

Louis  the  XVI.  himself — as  no  one  can  doubt  who  has  ap- 
proached the  sources  of  the  history  of  this  period  —  entered  on  the 
task  of  government  with  a  heai't  full  of  piety,  philanthropy,  and 
public  spirit.  He  was  earnest  and  pure-minded,  penetrated  by  a 
sense  of  his  own  dignity  and  the  responsibilities  attached  to  it ; 
and  firmly  resolved  to  close  forever  the  infamous  paths  in  which 
his  predecessor  had  walked. 

But,  unhappily,  his  capacity  bore  no  proportion  to  his  good 
will.  He  was  incapable  of  forming  a  decision  ;  his  education 
was  deficient;  he  was  awkward  both  in  person  and  speech,  and 
slow  of  comprehension.  As  he  had  a  very  limited  knowledge 
both  of  the  people  and  the  condition  of  his  empire,  the  selection 
of  his  ministers  was,  from  the  very  outset,  determined  by  accident, 
—  the  influence  of  his  aunts,  his  queen,  or  the  contending  court 
factions ;  and  as  he  was  immovable  wherever  morality  was  con- 
cerned, but  utterly  helpless  in  the  practical  execution  of  his  ideas, 
his  was  just  a  case  in  which  almost  everything  depended  on  the 
aid  of  his  nearest  advisers.  He  possessed  just  sufficient  sense  of 
justice  and  benevolence  to  encourage  every  effort  for  useful  re- 
forms ;  but  lacked  entirely  that  firmness  of  an  enlightened  judg- 
ment which  knows  how  to  bring  about  a  positive  result,  in  spite 
of  the  opposition  of  existing  interests.  The  inevitable  conse- 
quences soon  showed  themselves.  Anarchy,  which  under  Louis 
XV.  had  reigned  in  the  minds  of  men,  now  broke  forth  into 
overt  acts.  The  sufferings  of  the  people,  which  individuals  had 


CAUSES  OF  THE  FRENCH  REVOLUTION.        6/ 

hitherto  borne  in  silent  apathy,  now  occupied  the  attention  of  the 
masses. 

The  same  chance  which  in  his  reign  directed  the  management 
of  public  business,  had  given  him,  as  his  first  minister,  Turgot, 
the  greatest  reformer  of  the  day. 

This  great  minister's  strokes  fell  heavily  on  the  existing  system 
in  every  direction.  Among  his  measures  we  find  free  trade  in 
corn  ;  abolition  of  the  corvee  in  the  country  districts  ;  liberation 
of  trade  from  the  trammels  of  the  guilds  ;  the  erection  of  the 
catsse  d'escompte;1  a  number  of  improvements  and  alleviations 
in  the  mode  of  raising  the  public  taxes  ;  and  a  prospect  held  out 
to  all  possessors  of  property,  of  a  gradual  increasing  share  in 
political  rights :  and  it  is  under  these  heads  that  the  restless 
activity  of  this  liberal  statesman  may  be  best  arranged.  We  may 
easilv  conceive  that  there  was  scarcely  one  of  the  privileged 
classes  which  did  not  consider  its  previous  existence  imperilled. 

Opposition  rose  in  every  quarter:  the  courtiers,  the  parlia- 
ments, the  landed  aristocracy,  and  the  members  of  the  guilds  — 
all  threw  themselves  into  an  attitude  of  defence,  with  noisy  zeal. 
The  contest  penetrated  into  the  royal  family  itself,  —  Louis's 
younger  brother,  Count  Charles  of  Artois,  abused  the  minister, 
who,  he  said,  was  undermining  the  aristocracy,  the  prop  and 
rampart  of  the  throne  ;  and  a  cousin  of  the  king,  the  rich  and 
abandoned  Philip,  Duke  of  Orleans,  began,  amid  the  general 
excitement,  to  play  the  demagogue  on  his  own  account.  Then, 
for  the  first  time,  a  spectacle  was  seen  in  Paris,  which  was  sub- 
sequently repeated  in  ever  darker  colors, — the  spectacle  of  the 
police  authorities  of  the  capital  stirring  up  the  mob  against  the 
crown,  and,  on  this  occasion,  in  the  interest  of  the  privileged 
classes. 

At  first  Louis  XVI.  declared  that  he  and  Turgot  were  the  only 
friends  of  the  people,  and  stood  firm  against  the  parliament  of 
Paris  and  the  street  rioters  ;  but  he  was  not  proof  against  the 
feebleness  of  his  own  character  and  the  wearing  influence  of 
those  by  whom  he  was  daily  surrounded.  After  an  administration 
of  nearly  a  year  and  a  half  Turgot  was  obliged  to  yield  to  the 
reaction  of  the  ancien  regime,  and  almost  all  his  creations  col- 
lapsed at  once.  Then  followed  a  long  period  of  experiments  and 
palliatives  ;  the  successors  of  Turgot  would  gladly  have  gone  on 

1  An  institution  for  lending  money  for  the  furtherance  of  manufactures  and  commerce. 


68  SELECTIONS. 

in  the  broad  track  of  traditional  privileges  if  their  increasing 
financial  difficulties  had  left  them  any  peace.  It  was  just  at  this 
time  that  Louis  resolved  to  support  the  North  Americans  against 
England,  which  he  really  did  against  his  own  will  and  the  views 
of  his  ministers,  who  dreaded  the  expense  of  a  great  war,  and 
clearly  saw  that  the  emancipation  of  the  colonies  would  not 
weaken  England.  But  the  undefined  longing  for  freedom,  and 
the  liberal  political  doctrines  which  had  taken  root  far  and  wide 
in  the  land,  prevailed  over  the  scruples  of  the  king  and  his  coun- 
sellors. The  Marquis  of  Lafayette,  then  a  tall  light-haired  youth, 
full  of  vanity  and  ambition,  who,  on  account  of  his  ungraceful 
manners,  had  no  success  at  court,  fitted  out  a  ship  at  his  own 
expense,  and  sailed  across  the  Atlantic.  A  number  of  influential 
persons  cried  out  for  vengeance  upon  England  for  the  humiliation 
sustained  in  the  Seven  Years'  War;  in  a  word,  the  warlike  party 
carried  their  point,  and  war  was  declared  against  England.  The 
consequence  to  France  was  a  rapid  spread  of  democratic  senti- 
ments on  the  American  pattern.  The  followers  of  Rousseau 
were  triumphant;  here,  they  said,  might  be  seen  the  possibility 
of  a  democracy  on  a  broad  basis,  —  the  construction  of  a  State 
on  the  foundation  of  the  natural  rights  of  man.  Another  conse- 
quence of  the  war  was  to  throw  fresh  burdens  on  the  public  ex- 
chequer. The  minister  of  finance  at  this  time  was  Necker,  a  native 
of  Geneva.  Having  come  to  Paris  as  a  poor  clerk,  he  had  risen  by 
his  talents  and  skill  in  business  to  the  position  of  a  rich  banker, 
and  with  great  self-complacency  had  made  his  house  the  rendez- 
vous of  the  more  distinguished  members  of  the  liberal  party.  By 
his  influence  with  the  bourse  he  procured  a  certain  degree  of 
credit  for  the  State,  and  raised  loan  after  loan  to  the  amount  of 
500  millions,  without  any  increase  of  the  taxes,  or  any  provision 
for  a  liquidation  of  the  debt  incurred.  This  was  evidently  sacri- 
ficing the  future  to  the  present,  since  the  deficit  became  larger 
every  year,  as  the  interest  of  the  public  debt  increased.  Necker 
had  the  real  merit  of  bringing  some  of  the  departments  of  finance 
mto  better  order ;  he  enjoyed,  for  the  time  being,  unbounded 
popularity,  and  basked  with  delight  in  the  universal  acknowledg- 
ment that  he  was  the  greatest  statesman  in  Europe.  Public  con- 
fidence was  freely  given  to  a  minister  who  endeavored  to  found 
his  administration  on  credit  alone, —  i.e.  on  the  confidence  of  man- 
kind. He  was  looked  on  as  a  perfect  hero  when  he  introduced, 
with  good  results,  provincial  assemblies  into  Berry  and  Guyenne, 


CAUSES  OF  THE  FRENCH  REVOLUTION.        69 

and  soon  afterwards  —  breaking  through  all  the  traditions  of  the 
ancient  monarchy  —  published  a  detailed,  but  unfortunately  very 
inexact  and  highly  colored,  report  on  the  state  of  the  finances. 
But,  as  he  nowhere  laid  the  axe  to  the  root  of  the  evil,  he  only 
roused  a  number  of  powerful  interests  by  his  attempts  at  innova- 
tion, but  was  utterly  unable  to  close  the  source  of  financial  con- 
fusion. He,  too,  soon  saw  no  other  means  of  recovery  but  limi- 
tation of  the  budget  and  economy  in  the  expenses  of  the  court, 
by  avowing  which  he  made  himself  hateful  to  all  the  grandees  of 
the  antechamber,  and  was  deprived  of  his  office  in  May,  1781. 
After  two  insignificant  and  inexperienced  ministers  had  exhausted 
their  strength,  in  the  years  immediately  following,  the  intendant 
of  Lille,  the  gifted  but  frivolous  Calonne,  was  called  to  the  helm. 
He  began  with  the  proposition,  that  whoever  wished  for  credit 
must  cultivate  luxury ;  and  he  renewed  the  prodigality  of  the 
court,  in  the  style  of  Louis  XV.  After  matters  had  gone  on  in 
this  jubilant  course  for  some  years  and  the  public  debt  had  been 
increased  by  400  millions,  and  the  taxation  by  twenty-one  mil- 
lions, the  ruin  of  the  country  became  palpable  at  the  beginning 
of  the  year  1787  and  the  catastrophe  inevitable. 

Let  us  here  cast  a  glance  at  the  budget  of  the  ancien  regime, 
the  disorder  of  which  was  to  give  the  signal  of  convulsion  to 
every  quarter  of  the  civilized  world.  After  Necker  and  Calonne, 
the  Notables  and  the  Revolution,  have  quarrelled  about  its  con- 
tents with  equal  mendacity,  this  budget  now  lies,  in  its  most 
secret  details,  before  the  eyes  of  the  historical  inquirer.1 

And  first,  with  regard  to  the  national  income,  which,  as  is  well 
known,  amounted  to  about  500  millions  before  1789,  nearlv  800 
under  Napoleon,  and  then  increased,  during  the  period  between 
1815  and  1848,  to  1,500  million  francs.  However  definite  these 
figures  may  appear,  we  can  by  no  means  draw  a  conclusion  frorn 
them  as  to  the  cheapness  of  the  respective  modes  of  government 
above-mentioned.  We  have  already  observed,  that  in  proportion 
to  the  national  wealth,  a  taxation  of  500  millions  before  1789 
would  be  about  equivalent  to  one  of  1,500  millions  at  the  present 
day.  In  the  next  place,  we  must  make  several  additions  to  the 
round  sum  of  500  millions. 

The  income  of  the  State  in  the  year  1785  was  calculated  at  558 
millions,  to  which  were  added  41  millions  more,  for  the  local 

^Bailly,  "  Hist,  financ.  de  la  France,"  II.  278. 


70  SELECTIONS. 

administration  of  the  provinces  ;  a  sum  which  was  never  paid 
into  the  treasury,  but  immediately  expended  in  the  different  places 
where  it  was  raised.  Thus  we  find  that  the  nation  was  bearing 
an  annual  burden  of  from  599  to  600  millions.  At  the  same  time 
the  Church,  whose  expenses  now  figure  in  the  budget  of  the 
State,  raised  133  millions  in  tithes,  and  16  millions  in  other  dues 
and  offerings.1  The  fees,  which  served  as  a  compliment  to  the 
judicial  salaries,  amounted  to  29  millions;2  the  seigniors  raised 
about  2,500,000  in  tolls  of  various  kinds,  and  at  least  37,000,000 
in  stamp  duties.3  I  pass  over  the  feudal  rents  and  services,  the 
valuation  of  which  is  quite  impossible.  These,  from  their  very 
nature,  cannot  be  taken  into  account  in  speaking  of  the  public 
burdens,  and  may  very  well  be  set  off  against  the  mortgage  debts 
of  the  modern  peasant  proprietors. 

The  items  already  mentioned,  however,  in  addition  to  some  of 
a  similar  character,  amounted  to  280  millions  ;  so  that  the  French 
people  had,  at  that  period,  to  bear  a  total  annual  taxation  of  SSo 
millions.  If  we  compare  this  sum  with  the  national  wealth,  we 
may  unhesitatingly  set  it  down  as  equivalent  to  an  amount  of 
2,400  millions  at  the  present  day  ;  it  follows,  therefore,  that  from 
the  time  of  Louis  XV.  to  that  of  Napoleon  III.  there  existed  but 
one  government  in  France,  which  appropriated  to  itself  a  still 
larger  proportion  to  the  public  income  than  the  ancien  regime 
—  and  that  one  was  the  government  of  the  Jacobins  during  the 
Reign  of  Terror.  The  Empire,  the  Restoration,  and  Louis 
Philippe  contented  themselves  with  far  smaller  sums  ;  here,  too, 
feudalism  finds  its  counterpart  among  the  socialists. 

When  we  inquire  into  the  distribution  of  these  taxes  among 
the  different  classes  of  the  people,  we  discover  a  glaring  in- 
equality. The  higher  ranks  were  not,  indeed,  exempt  from  taxa- 
tion, but  they  were  in  many  respects  favored.  Of  the  taxes  on 
consumption  —  which  were  valued  at  308  millions  —  they  bore, 
of  course,  a  full  share  ;  but  of  the  land  and  capitation  taxes  (171 
millions)  they  ought,  as  was  discovered  during  the  Revolution, 
to  have  paid,  on  a  fair  distribution,  33  millions  more  than  they 
actually  did.  In  the  next  place,  the  maintenance  of  the  public 

1  Louis  Blanc,  B.  III.  c.  3,  estimates  them,  according  to  other  authorities,  not  at  16,  but 
at  30  millions. 

-  According  to  other  estimates,  42  millions.  Boiteau,  "  Etatde  la  France  en  1781."  Paris, 
1861. 

3  For  the  sake  of  brevity  I  use  this  term  to  denote  all  the  fees  paid  on  change  of  prop- 
erty, e.g.,  lods,  relods,  quints,  etc. 


CAUSES    OF   THE   FRENCH    REVOLUTION.  /I 

roads,  which  were  entirely  kept  up  by  means  of  the  corvee,  at  a 
cost  of  20  millions  ;  and,  further,  the  expenses  of  the  provincial 
militia  —  about  six  and  one-fourth  millions  —  rested  entirely  on 
the  shoulders  of  the  lower  classes.  If  we  take  into  consideration 
the  40  millions  quoted  above,  which  the  seigniors  received  from 
the  peasants, —  the  fact  that  the  poorer  classes  of  every  town  were 
responsible  for  the  taxes  of  their  commune,  —  even  when  their 
rich  fellow-citizens  escaped  payment  by  the  purchase  of  privileged 
offices  ;  and,  lastly,  the  scandalous  unfairness  in  the  imposition  of 
the  taxes  on  consumption,  to  which  the  helpless  multitude  was 
subjected  by  their  superiors,  we  shall  easily  understand  the 
triumphant  fury  with  which,  in  1789,  the  peasants,  more  espe- 
cially, received  the  joyful  intelligence  of  the  utter  destruction  of 
the  system  above  described. 

Great  as  was  the  proportion  which  it  exacted  of  the  national 
income  the  government  found  itself,  nevertheless,  in  a  state  of 
ever-increasing  need  and  embarrassment.  Disorder  on  the  one 
side  and  selfishness  on  the  other  scattered  its  treasures  to  the 
wind.  The  case  was  the  same  in  the  financial  administration  as 
in  that  of  justice  ;  no  one  had  ever  tried  to  organize  it  on  any 
grand  principle  of  wise  adaptation  to  the  end  in  view  ;  on  the 
contrary,  a  number  of  isolated  jurisdictions  —  distinguished  from 
one  another  according  to  provinces,  or  sources  of  income,  or  the 
destination  of  the  funds  in  question  —  existed  side  by  side,  inter- 
fering with  each  other's  operations  and  destroying  all  responsi- 
bility. The  amount  of  arrears  due  the  treasury — equal  perhaps  to 
half  the  annual  budget  —  not  even  the  Revolution  has  been  able 
to  ascertain,  and  it  could  only  get  hold  of  the  profits  of  the  farm- 
ei'S  of  the  revenue  by  means  of  the  guillotine.  When  once 
familiarized  with  deficits  the  government  soon  fell  into  the  stream 
of  floating  debts.  The  anticipation  of  the  revenue  of  future  years, 
at  a  usurious  discount  paid  to  the  collectors  themselves,  the  put- 
ting oft' the  payment  of  debts  which  had  fallen  due,  and  the  omis- 
sion of  expenditure  prescribed  by  law,  were  the  cause  of  equally 
enormous  losses,  when  the  day  for  liquidation  at  last  arrived. 
How  widely  this  confusion  spread,  may  be  gathered  from  the 
actual  cash  accounts  of  the  year  1785.  By  the  side  of  the  regular 
income  of  the  treasury,  of  not  quite  357  millions,  there  is  another 
account  of  493  millions  income,  and  407  millions  expenditure, 
consisting  of  items  which  belong  either  to  the  earlier  or  later  years 
of  the  period  between  1781  and  1787;  so  that  the  sum  total 


72  SELECTIONS. 

amounts  to  nearly  850  millions.  We  see  what  a  field  was  opened 
to  speculators  and  the  lovers  of  plunder,  and  to  what  a  state  such 
proceedings  had  reduced  the  prosperity  of  an  empire,  which  a 
hundred  years  earlier,  and  twenty  years  later,  dictated  its  will  to 
Europe  as  a  law. 

The  last  feature  in  this  State  economy  which  reveals  to  us  its 
character  is  the  kind  of  expenditure  in  which  these  treasures,  col- 
lected with  so  much  difficulty,  were  employed.  The  expenses  of 
the  court  were  stated  in  the  official  budget  at  thirty-three  or  thirty- 
five  millions,  but  they  were  in  reality  forty  millions,  which  did  not 
include  the  royal  hunting  expeditions  and  journeys,  the  salaries 
of  the  great  officers  of  the  court,  or  the  maintenance  of  the  royal 
palaces.  The  war  office  —  the  cost  of  which  Necker  states  at 
ninety-nine  millions  and  Calonne  at  114  millions  —  received  131 
millions,  of  which  rather  more  than  thirty-nine  millions  went  to 
the  administration,  forty-four  millions  for  the  pay  and  commis- 
sariat of  the  troops,  and  forty-six  millions  for  the  salaries  of  the 
officers. 

Entirely  removed  from  all  ministerial  calculation  were  the 
money  orders  of  the  king  himself,  "for  presents,  etc.,  to  court- 
iers, to  the  minister  of  finance  and  magistrates ;  repayment  of 
foreign  loans  ;  interest  and  discount  to  the  treasury  officials  ;  re- 
mission of  certain  personal  taxes,  and  unforeseen  expenses  of 
every  kind."  This  class  of  expenditure,  which  is  well  char- 
acterized by  the  above  heading,  amounted  in  1785  to  136  millions ; 
in  other  years  the  sum  was  rather  smaller ;  but  we  may  fairly 
assume  that  the  annual  average  was  more  than  100  millions.1 
And  whilst  we  thus  see  nothing  but  abundance  and  superfluity 
among  the  highest  classes  pf  society,  the  bridges  and  roads  are 
only  set  down  at  four  millions ;  the  public  buildings  at  scarcely 
two  millions,  and  the  scientific  institutions  at  rather  more  than 
one  million  ;  for  which  objects  the  budget  of  1832  and  the  fol- 
lowing years  granted  59  millions!  The  hospitals  and  foundling 
institutions  received  six  millions  from  the  State,  six  from  the 
church,  and  had  a  revenue  of  twenty-four  millions  of  their  own  ; 
while  the  benevolent  institutions  of  modern  France  (1832)  had 
an  annual  sum  of  119  millions  at  their  disposal.  In  short,  what- 
ever portion  of  the  financial  affairs  of  this  feudal  state  we  investi- 

1  We  arrive  at  this  result  from  the  debates  of  the  "  Assemblee  Constituante  "  (in  April, 
1790)  on  the  pensions,  the  ordonnances  a  comptant,  and  the  iivre  rouge.  Louis  Blanc 
gives  a  number  of  details  from  these  in  B.  IV.,  ch.  5. 


CAUSES    OF   THE    FRENCH    REVOLUTION.  73 

gate,  we  arrive  at  the  same  result,  and  find  the  people  separated 
into  two  great  classes,  one  of  which  was  enriched  at  the  cost  of 
the  other. 

But  as  every  such  draining  of  the  wealth  of  a  nation  bears 
within  itself  the  germs  of  ruin,  by  drying  up,  on  the  one  hand, 
the  sources  of  income,  and  increasing,  on  the  other,  the  passion 
for  extravagance,  the  government  found  itself  at  the  end  of  1786 
in  the  following  condition  :  The  regular  annual  income  was  327 
millions.  The  annual  expenditure,  according  to  the  treasury  ac- 
counts, amounted  to  340  millions.  In  addition  to  this  thei'e  were 
27  millions  for  pensions,  and  72  millions  of  urgent  arrears  from 
former  years  ;  and,  lastly,  in  the  year  1787,  there  was  a  loss  of  21 
millions  from  the  cessation  of  a  tax,  which  had  only  been  im- 
posed for  a  period  ending  with  that  year.  The  deficit,  therefore, 
amounted  to  198  millions.  Up  to  this  time  the  government  had 
helped  itself  by  all  the  artifices,  both  bad  and  good,  of  a  credit 
strained  to  the  very  utmost  and  now  utterly  exhausted.  An  in- 
crease of  the  taxes  was  not  to  be  thought  of,  on  account  of  the 
enormous  burdens  by  which  the  nation  was  already  crushed. 
Under  these  circumstances  Calonne,  with  genial  frivolity,  re- 
curred to  the  serious  and  noble  plans  of  Turgot. 

He  had  hitherto  lived  on  the  favor  of  the  privileged  classes  ; 
he  now  endeavored,  by  sacrificing  them,  to  relieve  the  common- 
wealth. He  congratulated  the  State  on  having  within  it  so  many 
great  abuses  by  the  removal  of  which  new  sources  of  prosperity 
might  be  opened  ! 

The  opposition  which  Turgot  had  met  with  was  of  course 
directed,  with  redoubled  fury,  against  Calonne. 

A  closely  crowded  throng  of  privileges  rose  tumultuously 
against  his  plans.  The  court  nobility,  the  provincial  estates,  the 
tax-collectors,  the  courts  of  law,  the  police  officers,  the  council- 
lors of  the  commune,  and  the  heads  of  the  guilds,  took  up  the 
contest  against  the  will  of  the  king  and  his  ministers.  But 
the  development  of  modern  ideas  had  made  such  progress  that 
the  parties  competed  with  one  another  for  the  power  of  public 
opinion.  The  ministry  itself  emancipated  the  press,  in  order  to 
expose  the  advocates  of  the  old  system  to  the  national  contempt. 
The  young  nobles  of  the  court  and  in  the  provinces  armed  the 
mob  of  Paris  and  the  peasants  of  Auvergne  against  the  min- 
isters, and  instigated  them  to  violent  excesses.  An  assembly  of 
aristocratic  notables,  to  whom  Calonne  submitted  his  schemes  of 


74  SELECTIONS. 

reform,  refused  their  assent,  claimed  the  right  of  inspecting  and 
superintending  every  department  of  the  public  service,  and  ended 
by  declaring,  that  as  they  were  nominees  of  the  king,  and  not 
representatives  of  the  nation,  they  were  not  competent  to  make 
new  grants.  Immediately  after  their  dismissal  the  parliament  of 
Paris,  which,  next  to  the  ministry,  was  the  highest  authority  in  the 
State,  brought  forward,  as  a  positive  demand,  what  the  notables 
had  only  negatively  suggested.  In  a  formal  decree  they  demanded 
that  an  Assembly  of  the  States-general  should  be  called,  —  an 
Assembly  which  the  monarchy  had  dispensed  with  for  200  years. 
The  ministry  at  first  received  this  proposal  with  great  disfavor ; 
but  as  the  want  of  money  grew  more  and  more  urgent,  the  allur- 
ing hope  arose  in  their  minds  of  finding  in  the  States-general, 
which  was  chiefly  composed  of  burghers,  a  powerful  support 
against  the  privileged  classes.  We  shall  never  understand  the 
extraordinary  success  of  the  first  revolutionary  movements,  unless 
we  bear  in  mind  what  a  large  share  in  the  government  of  the 
country  was  possessed  by  the  higher  orders  and  the  corporations, 
and  how  they  now  mutually  sought  each  other's  destruction. 

Calonne  was  not  long  able  to  make  head  against  this  noisy 
opposition.  The  last  of  the  many  blows  which  caused  his  fall 
was  dealt  by  the  queen,  whom  he  afterwards  persecuted  with  in- 
extinguishable hatred.  His  successor,  Brienne,  after  a  violent 
contest  with  the  parliaments,  resigned  his  office,  when  the  convo- 
cation of  the  States-general  had  already  been  determined  on,  and 
the  national  bankruptcy  virtually  proclaimed.  Louis  had  recourse 
to  Necker  again,  who  really  relieved  the  financial  embarrassment 
for  the  moment,  and,  recognizing  the  necessity  of  a  liberal  policy, 
fixed  the  meeting  of  the  States-general  for  the  27th  of  April,  1789. 
The  ferment  which,  owing  to  the  preceding  disputes,  had  for  the 
first  time  since  the  religious  wars  penetrated  the  mass  of  the  peo- 
ple, increased  from  hour  to  hour.  The  agitation  was  principally 
caused  by  the  question,  whether  the  States-general  should  meet 
as  before  in  three  separate  chambers,  or  form  a  single  assembly, 
in  which  the  tiers  etat  should  have  a  double  number  of  votes. 
On  this  point  the  hitherto  allied  opposition  parties  differed,  —  the 
aristocrats  advocating  the  separation,  the  liberals  the  union  of  the 
three  estates.  Necker,  with  great  want  of  tact,  betrayed  his  own 
views  by  assigning  the  double  number  of  votes  to  the  tiers  etat 
while  he  induced  the  government  to  observe  an  obstinate  silence 
on  the  main  point  in  question.  The  public  debates  on  this  sub- 


CAUSES    OF  THE   FRENCH    REVOLUTION.  75 

ject  were  all  the  more  violent  in  consequence  of  this  reticence  ; 
and  in  Bretagne  it  came  to  an  open  civil  war  between  the  nobility 
and  the  burghers. 

The  radical  elements  in  France  saw  that  their  time  for  action 
was  come  ;  and  the  great  dearness  of  pi'ovisions  which  prevailed 
during  the  winter  months  placed  a  large  number  of  desperate 
men  at  the  disposal  of  every  conspirator.  In  Paris  the  revolu- 
tionary demagogues  gathered  round  the  agents  of  the  Duke  of 
Orleans,  and  at  the  end  of  April  tried  their  strength  in  a  sangui- 
nary street  riot,  which  was  professedly  directed  against  the  usurious 
avarice  of  a  rich  manufacturer,  but  really  had  no  other  object 
than  to  intimidate  the  moderate  party,  before  the  impending  elec- 
tion of  the  States-general.1  In  other  respects  external  quiet  still 
prevailed  in  the  provinces ;  but  the  feverish  agitation  of  men's 
minds  increased  with  every  day ;  and  in  this  state  of  things 
the  elections  by  almost  universal  suffrage  began  to  be  held. 
Every  electoral  college  was  to  intrust  its  instructions  and  com- 
plaints to  its  deputies  according  to  mediaeval  custom.  In  every 
district,  therefore,  a  long  list  of  abuses  was  drawn  up  and  ex- 
amined and  brought  home  to  the  minds  of  the  people  at  large  by 
means  of  discussion.  A  modern  historian  has  justly  observed 
that  these  complaints  do  not  leave  a  single  particle  of  the  ancien 
regime  untouched  ;  that  everything  was  rejected  by  the  restless 
desire  of  innovation,  and  that,  unfortunately,  neither  the  possi- 
bility nor  the  method  of  introducing  reforms  is  anywhere  pointed 
out.  Revolution  —  universal  and  radical  revolution  —  speaks  in 
every  line  of  these  documents.  There  was  but  one  thought 
through  the  whole  of  France,  that  thenceforward  a  new  era  was 
to  commence  for  the  people  and  the  empire,  and  that  the  work 
begun  must  be  completed  in  spite  of  every  opposition. 

Whilst  the  millions  in  every  part  of  the  country  were  thus 
emancipating  themselves  from  the  bonds  of  traditional  law —  un- 
certain about  their  future,  but  firm  in  their  resolution  to  proceed 
—  the  government  was  daily  sinking  more  and  more  into  utter 
helplessness.  It  had  indeed  a  presentiment  of  the  dangers  which 
would  accompany  the  breaking  out  of  the  new  epoch,  but  its 
destitution  was  so  complete  that  it  eagerly  longed  for  the  com- 
mencement of  the  crisis.  Money,  one  of  the  great  factors  of 
material  power,  was  not  to  be  found  in  its  coffers  ;  and  even  the 

1  This  has  been  clearly  and  concisely  shown  by  Croker  in  his  "Essays  on  the  French 
Revolution,"  p.  50. 


76  SELECTIONS. 

other,  the  army,  was  already  affected  by  the  general  process  of 
dissolution.  This  is  perhaps  the  most  important  circumstance, 
with  respect  to  the  subsequent  course  of  the  French  Revolu- 
tion, and  its  difference  from  all  those  which  have  since  taken 
place  in  Europe.  The  reason  is  simple  enough  :  the  French 
army  was,  in  the  main,  organized  according  to  the  same  prin- 
ciples as  the  other  departments  of  the  State,  and,  like  them,  had 
been  thoroughly  unhinged  by  the  contests  between  the  crown  and 
the  feudal  orders,  long  before  the  breaking  out  of  the  Revolu- 
tion. The  nobility  alone  were  eligible  for  commissions  in  the 
army  ;  and  though  single  exceptions  to  this  rule  really  occurred, 
yet  the  monopoly  was  actually  limited  by  a  law  of  1781  to  noble- 
men of  four  descents.  Twenty-seven  regiments  belonged  to 
foreign  or  native  grandees,  and  in  these  the  owner  of  each  regi- 
ment appointed  the  colonel,  from  a  list  drawn  up  by  the  minister 
at  war;  and  the  colonel  appointed  the  other  officers.  The  influ- 
ence of  the  king's  government,  therefore,  in  the  selection  of 
officers,  was  limited  to  the  composition  of  the  list  of  candidates 
for  the  single  office  of  colonel.  In  the  other  divisions  of  the 
army,  indeed,  the  highest  rank  was  in  the  gift  of  the  king  alone  ; 
but  of  the  other  commissions  only  one-half  were  bestowed  by  the 
king,  and  the  other  half  by  the  colonel.  The  officer,  moreover, 
received  his  commission,  after  giving  proofs  of  his  fitness,  on 
payment  of  a  sum  of  money ;  it  was  a  purchase  for  life,  as,  in 
the  case  of  the  courts  of  law,  it  was  a  purchase  of  an  hereditary 
right.  The  duty  of  unconditional  obedience  was  not  indeed 
abrogated  by  this  system  ;  but  it  was  inevitable,  especially  under 
a  weak  government,  that  the  corps  of  officers  should  feel  itself, 
what  it  really  was,  a  part  of  that  great  aristocracy  which  shared 
with  the  King  the  ruling  power  of  France  in  every  department 
of  public  life.  The  contest  between  this  nobility  and  the  min- 
istry, by  which  the  last  years  of  the  ancien  regime  were  filled, 
must,  therefore,  have  had  a  deep  effect  upon  the  army.  It  fre- 
quently occurred  that  the  officers,  like  the  judges,  with  their 
colonels  at  their  head,  refused  obedience.  And  as  in  the  rural 
districts  the  opposition  of  the  aristocracy  was  followed  by  excite- 
ment among  the  peasants,  and  the  opposition  of  the  towns  by 
excitement  among  the  artisans,  so,  in  the  case  of  the  army,  the 
popular  movement  found  its  way  into  the  minds  of  the  soldiers, 
and  operated  side  by  side  with  the  class  resistance  of  the  officers. 
The  common  soldiers  had  felt  the  oppression  of  the  ancien 


CAUSES  OF  THE  FRENCH  REVOLUTION.         77 

regime,  perhaps,  more  deeply  than  the  peasants  themselves ;  for 
they  were  starving  on  a  pay  of  ten  sous,  whilst  countless  sums 
were  employed  in  rich  endowments  for  1,171  generals.  They 
suffered  all  the  insolence  of  the  nobility  towards  the  canaille, 
embittered  by  the  weight  of  a  severe  and  often  brutal  discipline  ; 
and,  like  their  fellow-citizens,  they  looked  forward  to  the  meeting 
of  the  States-general  as  the  signal  of  liberation  from  intolerable 
slavery.  The  number  of  regiments  on  which  the  government 
could  reckon  was  extremely  small.  The  bands  of  discipline 
were  loosened  in  evei-y  rank  ;  the  officers  inveighed  against  the 
despotism  of  the  ministers,  and  the  soldiers  promised  one  another 
to  do  nothing  against  the  people. 

The  ancient  polity,  therefore,  was  destroyed  by  its  own  internal 
discord  and  dissolution,  before  a  single  revolutionary  word  had 
been  uttered.  The  government  was  destitute  of  money  and  troops 
to  defend  its  position  ;  and  the  feudal  seigniors,  though  they  had 
important  individual  rights,  had  no  general  organization  which 
could  enable  them  to  replace  the  government.  As  soon  as  public 
opinion  —  which,  guided  by  radical  theories,  emphatically  re- 
jected both  the  government  and  the  aristocracy  —  obtained  an 
organ  of  power  in  the  States-general,  it  only  needed  to  declare  its 
will,  nay,  only  to  give  expression  to  the  facts  before  them,  and  the 
old  system  hopelessly  collapsed  in  its  own  rottenness.  What  was 
to  follow  no  man  at  that  time  was  able  to  foresee.  As  most  men 
were  extremely  ill-informed  respecting  the  condition  of  the  coun- 
try, they  indulged  in  hopes  which  were  all  the  more  ardent  in 
proportion  as  they  were  undefined.  But  there  were  many  who 
knew  the  poverty  and  brutality  of  the  masses,  the  bitter  hatred 
between  rich  and  poor,  and  the  selfish  immorality  of  the  upper 
classes,  and  looked,  some  with  ambitious  pleasure,  others  with 
patriotic  anxiety,  towards  a  stormy  future. 


78  SELECTIONS. 


V. 

THE   EMANCIPATING   EDICT   OF   STEIN. 
FROM  SEELEY'S  LIFE  AND  TIMES  OF  STEIN,  VOL.  I.,  PP.  287-305. 

I  CALL  by  this  name  the  great  Edict  which  was  signed  on  the 
9th  of  October,  i.e.  only  five  days  after  Stein  had  received  his 
powers,  not  solely  because  it  contains  the  provision  that  from  a 
certain  date  there  shall  be  only  free  persons  in  the  States  of  the 
King  of  Prussia.  It  is  indeed  to  be  remarked  that  the  princi- 
pal authors  of  the  measure  are  so  intoxicated  with  the  pride  of 
being  the  bestowers  of  freedom  upon  bondsmen,  that  they  forget 
to  remark  how  much  more  and  how  many  other  emancipations 
they  accomplished  by  the  same  act.  Stein's  own  account  of  the 
Edict  of  October  runs  as  follows :  — 

"  The  measures  adopted  to  reach  the  above-mentioned  general 
object  were  :  — 

"  (i)  Abolition  of  personal  serfdom  in  the  Prussian  Monarchy  : 
by  an  Edict  of  October,  1807,  it  was  decreed  that  from  October 
8th,  1809  (sic;  it  should  be  1810),  personal  serfdom  with  its  con- 
sequences, especially  the  very  oppressive  obligation  of  menial 
service,  should  be  abolished  ;  but  the  obligations  of  the  peasant, 
as  far  as  they  flowed  from  his  possession  of  property,  remained 
unaltered.  It  was  reserved  for  the  Chancellor  Hardenberg's  love 
of  innovation  (on  the  advice  of  a  H.  Scharrenweber,  a  dreamer 
who  died  in  a  madhouse  at  Eberbach  in  1820)  to  transform  in 
1811  the  relations  of  the  landlord  to  the  peasant  class,  and  its 
inner  family  relations  in  a  manner  pernicious  to  it ;  in  this  I  had 
no  share. 

"  (2)  The  transformation  of  the  peasants  on  the  Domain  in 
East  and  West  Prussia  into  free  proprietors." 

Here  not  a  word  is  said  of  any  changes  made  by  the  Edict  of 
October,  except  those  which  affected  the  peasant.  It  is  the  same 
aspect  of  the  Edict  which  interests  Schon.  This  Edict,  he  says. 
"  has  made  the  figure  of  the  king  stand  higher,  since  he  is  hence- 
forth no  longer  a  king  of  slaves,  but  of  free  men."  And  again : 
"  Thus  came  into  existence  the  law  of  Oct.  9th,  1807,  that 


EMANCIPATING   EDICT   OF   STEIN.  79 

Habeas  Corpus  Act  of  our  State.  The  idea  of  freedom  had 
begun  to  live.  With  ninety-nine  hundredths  of  the  people  it 
made  a  deep  and  elevating  impression  ;  the  few  friends  of  slavery 
intrigued  and  murmured  no  doubt  a  good  deal,  so  that,  according 
to  Rhediger's  story,  a  prejudiced  man  said  at  the  Berlin  Casino 
after  reading  the  law,  *  Rather  three  battles  of  Auerstadt  than 
such  a  law  ! '  But  the  king  stood  firm,  and  God  maintained  the 
right." 

In  stating  pretty  strongly  his  claims  to  be  considered  the  real 
author  of  the  law,  Schon  uses  language  which  shows  that  he  is 
thinking  almost  exclusively  of  this  part  of  it.  "  All  else  that  I 
did  in  life,"  he  says,  "  was  as  nothing  compared  to  calling  into 
life  the  idea  of  freedom."  Only  from  one  casual  expression  do 
we  learn  that  he  even  knew  that  the  measure  had  another  side, 
where  he  says,  "I  represented  that  hereditary  serfdom,  that 
scourge  of  our  country,  must  be  brought  to  an  end,  and  that  a 
proclamation  of  free  trade  in  landed  property  would  be  sufficient 
to  promote  material  interests." 

Here  we  are  suddenly  introduced  to  something  quite  new  and 
very  different  from  the  abolition  of  serfdom,  namely,  free  trade 
in  landed  property. 

Up  to  a  certain  point  it  is  true  that  these  two  things  coincide. 
One  part  of  the  burden  of  serfdom  lay  in  the  incapacity  of  the 
serf  to  alienate  his  land  ;  but  this  is  a  small  matter.  The  proc- 
lamation of  free  trade  in  land  affected  all  classes  of  society  at 
once,  and  the  upper  and  middle  classes  much  more  than  the 
peasantry.  When,  therefore,  we  observe  that  the  Edict  of  the 
9th  of  October,  at  the  same  time  that  it  abolished  personal  serf- 
dom, removed  all  the  principal  restrictions  that  interfered  with 
traffic  in  land,  we  see  that  it  is  in  fact  not  a  single  law,  but  two 
laws  in  one,  and  two  laws  of  such  magnitude  that  each  by  itself 
might  be  considered  equivalent  to  a  social  revolution. 

But,  when  we  look  closer  still,  we  discover  that  the  Edict  goes 
even  further,  and  should  be  rather  described  as  threefold  than  as 
twofold.  Englishmen  are  only  too  familiar  with  the  notion  of 
a  depressed  class  of  agricultural  laborers  ;  but  such  depression 
may  be  of  two  kinds,  and  may  spring  from  two  very  different 
causes.  We  are  not  to  suppose  that  the  peasantry  of  Prussia 
were  in  a  condition  resembling  that  of  our  own  laborers  any 
further  than  as  it  was  bad.  The  evils  afflicting  the  Prussian 
peasantry  were  those  arising  out  of  status ;  those  which  afflict 


80  SELECTIONS. 

English  laborers  arise  mainly  out  of  contract.  The  English 
laborer  is  nominally  free,  and  at  liberty  to  carry  his  industry  to 
the  best  market;  he  is  reduced  to  real  dependence  by  his  inabil- 
ity to  make  a  favorable  bargain  for  himself.  The  Prussian 
peasant  was  nominally  a  serf,  but  in  reality  some  very  impor- 
tant rights  were  secured  to  him.  We  are  not  to  suppose,  for 
instance,  that  cruel  punishments  were  allowed,  or  that  he  was 
subject  to  the  caprice  of  the  landlord.  He  was  far  more  of  a 
proprietor  than  the  English  laborer,  for,  though  on  a  degrading 
tenure,  he  did  for  practical  purposes  own  land.  Nor  were  his 
interests  neglected  as  those  of  a  freeman,  who  is  supposed  able 
to  take  care  of  himself,  may  be  neglected.  Not  only  was  he  a 
member  of  an  ancient  and  organized  village  community,  but  the 
Government  also  took,  and  was  obliged  to  take,  the  greatest  pos- 
sible interest  in  his  class,  for  these  serfs  were  neither  more  nor 
less  than  the  Prussian  army. 

Now  it  might  very  plausibly  be  maintained  that  the  proclama- 
tion of  free  trade  in  land  would  not  create  a  happy  peasant  class, 
but  would  simply  substitute  for  a  peasantry  laboring  under  cer- 
tain evils  that  class  of  famished  drudges  whom  we  know  in 
England,  and  who  if  they  cannot  be  called  serfs  can  still  less  be 
called  peasants,  for  a  peasant  properly  so  called  must  have  a 
personal  interest  in  the  land.  Hence  the  conservative  opponents 
of  Stein,  such  as  Marwitz,  actually  declare  that  there  existed  no 
slavery  or  serfdom  in  the  land  when  he  professed  to  abolish  it, 
but  "  that  it  then  for  the  first  time  began  to  appear,  namely,  the 
serfdom  of  the  small  holder  towards  the  creditor,  of  the  poor 
and  sick  towards  the  police  and  the  work-houses;"  and  again, 
"•  that  with  the  proclamation  of  free  trade  disappeared  the  previ- 
ous security  of  the  peasantry  in  their  holdings  ;  every  rich  land- 
owner could  now  buy  them  out  and  send  them  off —  fortunately 
scarcely  anybody  was  rich  any  longer  !  " 

These  were  the  criticisms  of  the  conservative  party,  which 
might  have  been  very  truly  applicable  to  a  simple  measure  of  free 
trade  in  land.  But  the  Edict  of  October  had  in  fact  taken 
account  of  the  danger,  and  contained  an  express  provision  to 
meet  it.  Hence,  as  I  have  said,  it  was  actually  a  threefold 
enactment,  for  not  only  did  it  first  abolish  serfdom  and,  secondly, 
establish  free  trade  in  land  ;  but.  thirdly,  it  endeavored  to  guard 
the  peasantry  against  the  danger,  which  in  so  many  countries 
has  proved  serious,  of  being  gradually  driven  out  or  turned  from 


EMANCIPATING   EDICT   OF   STEIN.  8 1 

proprietors  into  wage-receivers  by  the  effects  of  the  unequal 
competition  to  which  they  are  exposed. 

At  the  same  time  that  we  carefully  distinguish  these  different 
enactments  all  included  in  one  Legislative  Edict,  let  us  be  as 
careful  to  remark  what  was  not  included  in  it.  Englishmen  are 
apt  to  attribute  to  the  legislation  of  Stein  all  the  innovations 
introduced  in  this  period.  In  particular  it  has  been  supposed 
that  he  created  the  peasant-proprietorship  of  modern  Prussia. 
But  this  he  did  not  do,  except,  as  he  says  in  the  passage  quoted 
above,  on  the  Domain  Lands  of  West  and  East  Prussia.  Pro- 
prietors in  a  certain  sense  the  peasantry  were  before  this  Edict, 
that  is,  they  cultivated  land  for  themselves,  and  with  a  consider- 
able sense  of  security  ;  proprietors  in  the  full  sense  they  were 
not,  because  they  held  of  a  landlord  to  whom  they  owed  various 
dues  and  services.  Now  Stein's  Edict  altered  the  nature  of  these 
services,  and  abolished  the  most  oppressive  ;  but  it  did  not  destroy 
the  rights  of  the  landlord,  or  leave  the  peasant  sole  master  of  the 
land  he  cultivated.  It  was  reserved  for  Hardenberg  to  do  this 
by  an  Edict  issued  on  Sept.  I4th,  1811,  and  it  should  be  noticed 
that  Stein  expressly  declines  to  accept  any  responsibility  for  this 
innovation.  Again,  it  is  not  to  be  supposed  that  the  provision 
just  mentioned,  by  which  Stein  tried  to  prevent  the  absorption 
of  the  small  holdings  by  the  great  proprietors,  has  actually 
proved  the  means  of  preserving  the  peasant  class  in  Prussia  ;  for 
all  this  passed  away  with  the  legislation  of  Hardenberg,  and  it 
has  been  by  its  own  vitality,  and  not  by  State  interference  that 
peasant -proprietorship  has  maintained  itself. 

Further,  it  is  to  be  remarked  that  Stein  is  quite  accurate  when 
he  describes  his  Land  Reform  as  not  consisting  solely  in  the 
Edict  of  October,  but  as  including  also  another  quite  distinct 
act  of  legislation,  which  applied  only  to  the  provinces  of  East  and 
West  Prussia.  This  act  belongs  to  July,  1808,  and  is  confined 
not  simply  to  the  peasants  of  these  two  provinces,  but  to  a  par- 
ticular class  of  peasants,  viz.,  those  sometimes  called  immediate 
peasants,  or,  in  other  words,  those  who,  living  on  the  Royal  Do- 
mains, had  no  other  landlord  but  the  King.  It  is  evident  that  the 
Government  could  deal  with  these  more  easily  than  with 
those  peasants  whose  condition  it  could  not  improve  without 
meddling  with  the  rights  of  another  class.  The  extreme  distress 
in  which  these  two  provinces  lay,  and  which  the  Government 
was  in  no  condition  to  relieve  directly,  was  the  justification  for 


82  SELECTIONS. 

granting  privileges  to  these  particular  immediate  peasants,  which, 
for  the  moment,  were  not  extended  to  those  of  the  other  prov- 
inces. 

Such,  then,  defined  in  general  terms,  was  the  extent  of  this 
reform.  It  needs,  however,  a  much  closer  description.  In  the 
first  place  the  reader  must  guard  against  a  misapprehension  of 
the  phrase,  "  free  trade  in  land,"  into  which  he  is  likely  to  be  led 
by  his  English  experience.  Free  trade  in  land  is  also  a  cry  of 
our  own  reformers  ;  but  we  must  beware  of  supposing  that  what 
they  call  for  is  the  same  thing  that  was  granted  in  Prussia  by 
Stein's  Edict.  The  complaint  in  England  is  that  a  number  of 
practical  obstructions  prevent  land  from  being  the  object  of  such 
free  purchase  and  sale  as  other  commodities.  Much  of  the  land 
of  the  country,  it  is  said,  is  in  the  hands  of  persons  who  in  family 
settlements  have  given  up  the  right  to  alienate  it ;  the  system 
under  which  landed  property  is  conveyed  is  so  cumbrous  and  ex- 
pensive as  to  deter  people  from  transactions  of  the  kind  ;  and, 
lastly,  by  recognizing  the  principle  of  primogeniture  with  respect 
to  land  and  not  with  respect  to  personal  property  in  cases  of  in- 
testacy, the  law  itself  countenances  the  notion  that  landed 
property  stands  in  a  class  by  itself,  and  is  not  to  be  dealt  with 
or  transferred  as  if  it  were  purely  a  commodity.  Now,  it  is  an 
instance  of  the  confusing  and  misleading  inaccuracy  of  our  party 
cries,  when  the  removal  of  these  restrictions  is  called  free  trade 
in  land.  Free  trade  in  other  cases  means  the  removal  of  restric- 
tions imposed  bv  the  law  or  by  the  government ;  but  these  re- 
strictions are  of  quite  another  kind.  Only  the  last  mentioned  is 
the  work  of  the  law,  and  it  cannot  in  any  proper  sense  be  called 
a  restriction,  for  the  only  way  in  which  it  operates  restrictingly  is 
by  lending  the  moral  influence  of  the  law  to  the  support  of  a  re- 
strictive system.  The  cumbrousness  of  our  conveyancing  is 
merely  the  result  of  the  gradual  way  in  which  our  land  system 
has  been  formed,  and  as  to  the  system  of  settlements,  so  far  from 
'being  a  restriction  of  freedom,  it  is  the  direct  result  of  freedom  of 
'Contract,  so  much  so  that  the  reformers  themselves  demand  an 
interference  of  the  law  to  prevent  it ;  in  other  words,  wish  to 
promote  what  they  call  free  trade  by  a  new  legal  prohibition. 

Now,  when  Stein  is  said  to  have  established  free  trade  in  land, 
the  expression  is  to  be  understood  literally.  The  hindrances  to 
the  sale  and  purchase  of  land  which  he  removed  were  not  acci- 
dental practical  obstacles,  but  formal  legal  prohibitions.  In  the 


EMANCIPATING   EDICT   OF   STEIN.  83 

old  law  of  Prussia  and  in  the  Code  of  Frederick  or  Allgemeines 
Landrecht,  which  came  into  force  in  1794,  it  is  laid  down  that 
noble  estates  (adelige  Giiter)  can  only  be  held  by  nobles,  and 
that  persons  of  civic  origin  (biirgerlicher  Herknnft)  can  only 
acquire  them  by  express  permission  of  the  sovereign.  In  the 
same  way  peasant-land  could,  as  a  rule,  only  be  held  by  peasants, 
and  land  belonging  to  towns  only  by  citizens.  We  are  familiar 
with  the  idea  of  caste  as  applied  to  human  beings,  that  is,  of  an 
unalterable  status  stamped  upon  a  man  from  his  birth  ;  in  Prussia 
it  may  be  said  that  caste  extended  actually  to  the  land,  so  that 
every  rood  of  soil  in  the  country  was  of  a  definite  and  unalterable 
rank,  and,  however  it  might  change  its  owners,  always  remained 
either  noble  or  citizen  or  peasant  land.  Now,  the  first  innova- 
tion contained  .  in  Stein's  Edict  consisted  in  cancelling  in  the 
fewest  and  simplest  words  all  the  regulations  which  established 
caste  in  land. 

When  the  Edict  is  examined  more  closely  it  will  be  seen  to  be 
much  more  comprehensive  even  than  it  was  represented  above, 
when  I  pointed  out  how  much  more  comprehensive  it  was  than 
was  commonlv  supposed,  or  than  Stein  himself  described  it.  For 
at  the  same  time  that  it  abolishes  caste  in  land,  it  accomplishes 
another  act  of  emancipation,  which  is  in  no  way  expressed  in  the 
phrase  free  trade  in  land  ;  it  removes  another  quite  distinct  set 
of  restrictions,  and  abolishes  caste  in  persons.  The  Code  of 
Frederick  prohibited  the  nobleman  from  engaging  in  any  occu- 
pation properly  belonging  to  the  citizen,  and  only  allowed  under 
ceitain  conditions  the  citizen  to  pass  into  the  class  of  peasants 
or  the  peasant  into  the  class  of  citizens.  The  Nobles,  the 
Citizens,  the  Peasants  ;  these  were  the  three  castes  into  which 
the  Prussian  population,  outside  the  professions,  was  divided  ; 
into  one  or  other  of  them  each  person  was  born,  and  in  the  same, 
as  a  rule,  he  died.  To  each  caste  was  assigned  its  special  pur- 
suit. The  Noble  cultivated  his  estate  and  exercised  jurisdiction 
over  the  peasantry  who  held  under  him,  though  he  could  not 
himself  hold  or  cultivate  peasant-land  ;  he  also  served  the  king 
in  civil  or  military  office.  The  Peasant  cultivated  his  plot  of 
ground,  rendering  fixed  services  to  the  lord,  and  subject  to  his 
jurisdiction,  and  belonged  at  the  same  time  to  the  rank  and  file 
of  the  army.  Between  them  stood  the  Citizen,  holding  a  monop- 
oly of  trades  and  industries,  which  by  law  were  confined,  with 
few  exceptions,  to  the  towns.  It  is  remarkable  that  the  military 


84  SELECTIONS. 

profession  was,  for  the  most  part,  closed  to  him.  This  must  be 
borne  in  mind  when  we  compare  the  Seven  Years'  War  with  the 
War  of  Liberation.  We  have  .read  of  the  fearful  consumption 
of  men  caused  by  the  Seven  Years'  War,  and  of  the  desperate 
shifts  of  Frederick  to  procure  recruits  ;  but  we  must  understand 
that  no  levee  en  masse  took  place  then,  and  that  the  citizen  class 
had  scarcely  any  share  in  what  was  going  forward.  This  is  the 
more  to  be  noted  because  the  connection  between  the  citizen 
class  and  the  learned  class  was  closer  than  in  other  countries. 
The  learning,  literature,  and  philosophy,  which  flourished  so 
remarkably  in  that  age,  took  the  tone  of  the  middle  class,  and  a 
curious  result  followed.  In  the  most  military  of  all  modern 
States,  literature,  because  it  sprang  from  a  class  which  enjoyed 
an  exemption  from  military  service,  and  as  a  consequence,  the 
tone  of  public  feeling  which  is  determined  by  literature,  was  in 
an  especial  degree  wanting  in  the  military  spirit — Scharnhorst 
describes  the  army  as  being  generally  hated  and  despised,  and 
Kant  speaks  with  contempt  of  a  man  of  education  who  had  em- 
braced a  military  life  —  and  this  fact  goes  some  way  to  explain 
that  phenomenon  of  a  military  state  fighting  exceptionally  ill 
which  we  have  so  long  had  before  us. 

This  state  of  society  is  very  foreign  to  our  ideas,  and  may, 
perhaps,  because  we  have  no  experience  of  it,  fascinate  some 
imaginations.  No  Laissez  fa  ire  here ;  every  man's  place  is 
assigned  to  him  from  his  birth  ;  his  occupations  are  prescribed, 
and  a  great  taskmaster,  or  earthly  Providence,  stands  at  the  head 
of  the  whole  society,  which  may  be  called  army  or  nation  at 
pleasure,  since  even  the  unmilitary  citizens  were  regarded  by  the 
State  principally  as  a  sort  of  commissariat  department.  And, 
for  the  immediate  purpose  of  Frederick  William  I.  and  Frederick 
the  Great,  the  system  was  well  adapted,  for  that  purpose  was 
simply  military.  A  place  for  every  man,  and  every  man  in  his 
place ;  the  "  productive  forces  of  the  country  perfectly  inven- 
toried, and  a  debtor  and  creditor  account  of  its  resources  kept"  ;* 
by  such  a  system  the  rulers  could  wield  the  whole  force  of  the 
country  most  easily  and  certainly.  Nevertheless,  the  destruc- 
tion of  this  whole  system  by  a  stroke  of  Stein's  pen,  was  now 
regarded  as  the  greatest  of  reforms,  and  the  commencement  of 
the  restoration  of  Prussia.  For  it  will  be  evident  that  the  same 


EMANCIPATING   EDICT   OF  STEIN.  85 

system  which  concentrated  so  powerfully  and  measured  so 
exactly  the  forces  of  the  country  at  the  same  time  entirely  pre- 
vented them  from  growing,  not  to  mention  the  intellectual  stag- 
nation, outside  the  University  world,  which  was  produced  by 
such  rigid  uniformity  of  life.  A  country  in  which  no  man  can 
follow  his  natural  bent,  take  to  agriculture  if  he  does  not  like 
trade,  or  to  trade  if  he  does  not  succeed  in  agriculture,  is  evidently 
not  an  industrial  country ;  its  material  resources  under  such  a 
system  will  remain  undeveloped,  and  if  it  be  a  poor  country,  as 
Prussia  was,  the  system  will  actually  in  the  end  defeat  its  own 
object,  for  such  a  country  from  mere  poverty  will  be  weak  in 
war. 

As  the  first  section  of  the  Edict  abolished  what  I  have  called 
"  caste  in  land,"  so  the  second,  consisting  of  about  three  lines, 
abolished  caste  in  persons.  And  here  it  may  perhaps  be  observed 
that  I  omitted  above  one  principal  circumstance  which  made  such 
sweeping  changes  so  easy  to  Stein.  Before  the  Peace  of  Tilsit 
it  would  have  been  scarcely  possible  to  carry  out  such  reforms, 
however  much  the  rulers  might  have  been  convinced  of  their 
necessity.  Frederick  had  shrunk  from  the  emancipation  of  the 
serfs  because  he  felt  that  it  would  introduce  disorder  into  his 
army,  and  for  the  same  reason  these  reforms  also  would  have 
been  scarcely  practicable  so  long  as  the  army  existed.  The 
disasters  brought  with  them  the  compensation  that  they  destroyed 
for  a  moment  this  incubus  ;  the  necessity  of  maintaining  a  great 
position  in  Europe,  the  necessity  even  of  defending  the  country, 
ceased  when  the  country  actually  fell  into  French  occupation, 
and  thus,  as  we  may  say,  the  building  being  down,  it  was  for  the 
first  time  possible  to  mend  a  defect  in  the  foundations. 

These  reforms,  favored  as  they  were  by  circumstances  and  re- 
quiring but  few  lines  in  the  Edict,  were  yet  much  more  funda- 
mental and  pregnant  with  consequences  than  any  such  practical 
reforms  as  may  be  called  for  in  England  to  make  the  purchase  of 
land  more  easy.  They  were  a  sort  of  Magna  Charta  to  the 
Prussians,  and  Schon  might  well  have  applied  to  them  the 
enthusiastic  expressions  which  he  keeps  for  the  sections  which 
emancipated  the  serf.  In  v.  Ronne's  standard  text -book  of 
Prussian  Constitutional  Law,  I  find  in  the  chapter  on  Rights, 
under  the  first  title,  Freedom  or  Security  of  the  Person,  that 
this  freedom  is  composed  of  three  rights  :  (i)  the  right  of  move- 
ment and  free  choice  of  abode  (Freiziigigkeit)  ;  (2)  the  right  of 


86  SELECTIONS. 

emigration  (Auswanderungsrecht)  ;  (3)  the  right  of  choosing  a 
calling  or  trade  (Freie  Wahl  von  Beruf  uncl  Gewerbe)  ;  and  this 
third  right  we  are  informed  was  given  to  the  Prussians  by  the 
Edict  of  October,  1807.  The  same  is  said  of  the  first  of  the 
rights  which  go  to  make  up  the  second  Title  ;  viz.,  free  right  to 
the  acquisition  and  possession  of  property  (Freies  Recht  zum 
Erwerbe  und  Besitze  des  Eighenthums). 

I  proceed  to  give  the  text  of  this  Edict,  the  vast  importance 
of  which  will  have  by  this  time  become  clear.  The  less  impor- 
tant sections  are  printed  in  a  smaller  type,  and  of  §§  III.  and  V., 
as  purely  technical,  only  the  heading  is  given. 

"  Edict  concerning  the  facilitation  of  possession  and  the  free  use  of  landed 

property,  as  well  as  the  personal  relations  of  the  inhabitants  of  the 

country. 

"WE,  Frederick  William,  by  the  grace  of  God  King  of  Prussia,  &c., 
&c., 

"  Make  known  hereby  and  give  to  understand.  Since  the  beginning  of 
the  peace  We  have  been  before  all  things  occupied  with  the  care  for  the 
depressed  condition  of  Our  faithful  subjects,  and  the  speediest  restoration 
and  greatest  improvement  of  it.  We  have  herein  considered  that  in  the 
universal  need  it  passes  the  means  at  Our  command  to  furnish  help  to 
each  individual,  and  yet  We  could  not  attain  the  object ;  and  it  accords 
equally  with  the  imperative  demands  of  justice  and  with  the  principles  of 
a  proper  national  economy,  to  remove  all  the  hindrances  which  hitherto 
prevented  the  individual  from  attaining  the  prosperity  which,  according  to 
the  measure  of  his  powers,  he  was  capable  of  reaching;  further,  We  .have 
considered  that  the  existing  restrictions,  partly  on  the  possession  and 
enjoyment  of  landed  property,  partly  on  the  personal  condition  of  the 
agricultural  laborer,  specially  thwart  Our  benevolent  purpose  and  disable 
a  great  force  which  might  be  applied  to  the  restoration  of  cultivation,  the 
former  by  their  prejudicial  influence  on  the  value  of  landed  property  and 
the  credit  of  the  proprietor,  the  latter  by  diminishing  the  value  of  labor. 
We  purpose,  therefore,  to  reduce  both  within  the  limits  required  by  the 
common  well-being,  and  accordingly  ordain  as  follows  :  — 

"  §  I.     Freedom  of  Exchange  in  Land. 

"Every  inhabitant  of  our  States  is  competent,  without  any 
limitation  on  the  part  of  the  State,  to  possess  either  as  property 
or  pledge  landed  estates  of  every  kind  ;  the  nobleman  therefore 
to  possess  not  only  noble  but  also  non-noble,  citizen,  and  peasant 
lands  of  every  kind,  and  the  citizen  and  peasant  to  possess  not 
only  citizen,  peasant,  and  other  non-noble,  but  also  noble,  pieces 
of  land,  without  either  the  one  or  the  other  needing  any  special 


EMANCIPATING  EDICT   OF   STEIN.  8/ 

permission  for  any  acquisition  of  land  whatever,  although,  hence- 
forward as  before,  each  change  of  possession  must  be  announced 
to  the  authorities! 

"  §  II.     Free  Choice  of  Occupation. 

"  Every  noble  is  henceforth  permitted  without  any  derogation 
from  his  position,  to  exercise  citizen  occupation  ;  and  every  citi- 
zen or  peasant  is  allowed  to  pass  from  the  peasant  into  the  citizen 
class,  or  from  the  citizen  into  the  peasant  class. 

How  far  a  legal  right  of  Pre-emption  and  a  First  Claim  still 


"  §  IV.     Division  of  Lands. 

"  Owners  of  Estates  and  Lands  of  all  kinds,  in  themselves  alienable 
either  in  Town  or  Country,  are  allowed,  after  due  notice  given  to  the  pro- 
vincial authority,  with  reservation  of  the  rights  of  Direct  Creditors  and  of 
those  who  have  the  right  of  pre-emption  (§  III.),  to  separate  the  principal 
estate  and  its  parts,  and  in  general  to  alienate  piecemeal.  In  the  same 
way  Co-proprietors  may  divide  among  them  property  owned  in  common. 

"  §  V.     Granting  of  Estates  under  Leases  for  a  Long  Term. 

"  §  VI.     Extinction  and  Consolidation  of  Peasant  Holdings. 

"  When  a  landed  proprietor  believes  himself  unable  to  restore 
or  keep  up  the  several  peasant  holdings  existing  on  an  estate 
which  are  not  held  by  a  hereditary  tenure,  whether  of  a  long 
lease  or  of  copyhold,  he  is  required  to  give  information  to  the 
government  of  the  province,  with  the  sanction  of  which  the  con- 
solidation, either  of  several  holdings  into  a  single  peasant  estate, 
or  with  demesne  land,  may  be  allowed  as  soon  as  hereditary 
serfdom  shall  have  ceased  to  exist  on  the  estate.  The  provincial 
Authorities  will  be  provided  with  a  special  instruction  to  meet 
these  cases. 

"  §  VII.  If,  on  the  other  hand,  the  peasant  tenures  are  hered- 
itary, whether  of  long  lease  or  of  copyhold,  the  consolidation  or 
other  alteration  of  the  condition  of  the  lands  in  question,  is  not 
admissible  until  the  right  of  the  actual  possessor  is  extinguished, 
whether  by  the  purchase  of  it  by  the  lord  or  in  some  other  legal 
way.  In  this  case  the  regulations  of  §  VI.  also  apply. 

"  §  VIII.  Indebtedness  of  Feudal  and  Entailed  Estates  in  consequence 
of  the  Ravages  of  War. 

"  Every  possessor  of  feudal  or  entailed  property  is  empowered  to  raise 
the  sums  required  to  replace  the  losses  caused  by  war,  by  mortgaging  the 
substance  of  the  Estates  themselves,  as  well  as  the  revenues  of  them,  pro- 


88  SELECTIONS. 

vicled  the  application  of  the  money  is  attested  by  the  Administrator  (Land- 
rath)  of  the  Circle  or  the  Direction  of  the  Department.  At  the  end  of 
three  years  from  the  contracting  of  the  debt  the  possessor  and  his  suc- 
cessor are  bound  to  pay  off  at  least  the  fifteenth  part  of  the  capital  itself. 

"  IX.  Extinction  of  Feudal  Relations,  Family  Settlements,  and  En- 
tails, by  Family  Resolution. 

"  Every  feudal  connection  not  subject  to  a  Chief  Proprietor,  every 
family  settlement  and  entail  maybe  altered  at  pleasure  or  entirely  abolished 
by  a  Family  Resolution,  as  is  already  enacted  with  reference  to  the  East 
Prussian  Fiefs  (except  those  of  Ermeland)  in  the  East  Prussian  Provincial 
Law,  Appendix  36. 

"  §  X.     Abolition  of  Villainage. 

"  From  the  date  of  this  Ordinance  no  new  relation  of  villainage, 
whether  by  birth,  or  marriage,  or  acquisition  of  a  holding,  or  by 
contract,  can  come  into  existence. 

"  §  XI.  With  the  publication  of  the  present  Ordinance  the 
existing  condition  of  villainage  of  those  villains  with  their  wives 
and  children  who  possess  their  peasant-holdings  by  hereditary 
tenures,  of  whatever  kind,  ceases  entirely  both  with  its  rights  and 
duties. 

14  §  XII.  From  Martinmas,  iSro,  ceases  all  villainage  in  Our 
entire  States.  From  Martinmas,  1810,  there  shall  be  only  free 
persons,  as  this  is  already  the  case  upon  the  Domains  in  all  Our 
provinces ;  free  persons,  however,  still  subject,  as  a  matter  of 
course,  to  all  the  obligations  which  bind  them  as  free  persons  by 
virtue  of  the  possession  of  an  estate  or  by  virtue  of  a  special 
contract. 

"  To  this  declaration  of  Our  royal  Will  every  man  whom  it  may  concern, 
and  in  particular  Our  provincial  and  other  governments,  are  exactly  and 
loyally  to  conform  themselves,  and  the  present  Ordinance  is  to  be  made 
universally  known. 

"Authentically,  under  Our  royal  Signature.  Given  at  Memel,  Oct. 
9th,  1807. 

"  FRIEDRICH  WILHELM, 
"Schrotter,  Stein,  Schrbtter  II." 

The  elder  Schrotter  was  at  this  time  Minister  for  the  province 
of  Prussia,  and  he  with  his  brother  was  entrusted  with  the  task 
of  publishing  the  Ordinance  in  the  province  where  it  had  re- 
ceived the  king's  signature.  It  is  for  this  reason  that  their 
names  are  affixed  to  it  along  with  Stein's. 


EMANCIPATING   EDICT   OF   STEIN.  89 

That  threefold  character  of  the  Edict  which  was  pointed  out 
above,  will  appear  very  visibly  by  observing  the  three  groups  of 
sections,  which  on  account  of  their  especial  importance  have  been 
printed  in  large  type.  The  abolition  of  caste,  both  in  land  and 
in  persons,  is  accomplished  in  the  first  two  sections  ;  the  aboli- 
tion of  villainage  in  the  last  three,  which,  it  is  evident,  might  as 
well  have  composed  a  separate  edict.  Sections  6  and  7  are  intro- 
duced to  prevent  the  system  of  free  trade  in  land  from  bearing 
too  hard  on  the  peasant  and  making  the  proprietorship  of  land 
a  monopoly  of  the  richer  classes. 

Having  traced  the  history  of  the  preparation  of  this  Edict, 
and  examined  its  nature  and  the  changes  it  introduced,  we  are 
in  a  condition  to  inquire  who  are  the  persons  to  whom  the  Prus- 
sians may  consider  themselves  chieflv  indebted  for  it. 

In  such  cases  the  popular  mind  invariably  makes  a  misappre- 
hension which  it  is  almost  in  vain  to  attempt  to  correct.  It 
attributes  to  the  unassisted  intelligence  and  will  of  a  single 
author  what  was  necessarily  the  joint- work  of  many.  In  this 
instance  Stein  has  obtained  a  popular  fame  to  which  he  has  little 
right,  and  which  partly  compensates  for  much  unjust  neglect. 
While  his  real  life  and  actions  have  been  little  known,  he  has 
gained  a  sort  of  legendary  reputation,  such  as  has  gathered  round 
many  other  legislators,  and  has  been  credited  with  all  the  judg- 
ment, technical  skill  and  wisdom  implied  in  the  framing  of  a  law 
which  has  revolutionized  a  country.  His  admirers  need  not  hesi- 
tate for  a  moment  to  disown  for  him  all  such  ungrounded  preten- 
sions. In  the  construction  of  the  Emancipating  Edict  Stein  had 
no  great  share.  Before  it  reached  his  hands  it  was  almost  com- 
plete, and  we  may  distinguish  two  agents  bv  whom  it  had  been 
made  such  as  it  then  was.  The  first  agent  was  what  we  call  the 
Spirit  of  the  Age,  that  is,  the  sum  of  influence  proceeding  partly 
from  the  humanitarian  writers,  partly  from  the  economists  of  the 
eighteenth  century,  by  which  the  majority  of  those  who  guided 
public  affairs  had  been  convinced  of  the  necessity  of  certain  great 
changes.  When  a  man  like  Hardenberg,  who  had  no  special  or 
professional  learning,  confidently  sanctioned  such  sweeping  pro- 
posals as  those  which  Altenstein  laid  before  him,  he  proclaimed 
in  effect  that  the  work  of  the  Zeitgeist  was  done.  From  that 
moment  the  matter  of  the  law  existed,  and  the  question  of  the 
form  came  under  consideration.  Then  began  the  work  of  the 
second  agent,  that  is,  the  Immediate  Commission.  We  have  seen 


90  SELECTIONS. 

who  the  men  were  from  whose  deliberations  the  law  came  forth 
clothed  in  form.  But  perhaps  the  question  may  be  asked  which 
member,  or  members,  of  the  Commission  deserved  best  of  the 
law  ;  and  this  question  can  only  be  answered  partially  and  doubt- 
fully, many  of  the  documents  being  missing  in  the  archives.  We 
have  the  fact  that  Niebuhr  separated  himself  deliberately  from 
his  colleagues  because  he  would  not  take  the  responsibility  of 
their  plans.  For  the  rest  we  have  Schon's  Report,  of  which  an 
abstract  has  been  given  above,  and  we  have  some  reminiscences 
of  Schon,  which  were  written  down  at  a  much  later  period  and 
not  published  till  1875.  The  latter  indeed  give  us  many  state- 
ments, but  we  are  embarrassed  when  we  find  that  their  drift  is 
to  claim  the  whole  credit  of  the  Edict  for  Schon.  It  seems 
hardly  fair  to  the  other  members  of  the  Commission  to  accept  a 
representation  which  is  made  at  their  expense  and  published 
after  their  death.  When  we  test  it  in  the  only  way  open  to  us, 
that-  is,  by  comparing  it  with  Schon's  Report,  which  for  what  it 
asserts  is  far  better  testimony,  we  find  the  suspicions  decidedly 
strengthened,  which  the  claim  itself  by  its  exorbitant  and  ego- 
tistic character  suggests.  That  Schon  deserved  a  great  share  of 
the  credit  we  are  quite  prepared,  from  what  we  hear  of  the  in- 
fluence he  exerted,  to  believe  ;  nay,  after  a  reasonable  deduction 
for  evident  self-conceit,  we  might  be  willing  to  think  that  per- 
haps his  claim  to  have  been  the  guiding  spirit  of  the  Commission 
was  substantially  well-founded.  But  when  we  compare  his  late 
reminiscences  with  his  own  report  written  at  the  time,  as  well 
as  with  other  evidence,  we  discover  that  his  self-conceit  was  of 
an  unusual  intensity,  and  that  it  certainly  clouded  and  corrupted 
his  remembrances.  His  statement  is  not  merely  exaggerated  ; 
it  is  certainly  untrue,  and  gives  an  incorrect  impression  of  the 
nature  as  well  as  of  the  degree  of  the  influence  he  exerted. 

We  have  gathered  from  Niebuhr's  hints  that  he  had  friends 
on  the  Commission  who  applied  certain  doctrinaire  theories  with 
a  consistency  which  appalled  him,  and  in  fact  frightened  him 
away.  It  is  scarcely  possible  to  doubt  who  is  pointed  at.  Schon 
was  just  such  a  doctrinaire,  and  such  inexorable  consistency  was 
just  in  his  character,  while  nothing  similar  seems  to  be  true  of 
Altenstein  or  Stagemann.  It  seems  also  unquestionable  what 
rigorous  applications  of  theory  are  pointed  at.  The  introduc- 
tion of  free  trade  in  land  created  so  manifest  a  danger  of  the 
absorption  of  the  peasant-holdings  by  the  rich,  that  it  was  found 


EMANCIPATING    EDICT   OF   STEIN.  91 

in  the  end  necessary  to  protect  those  holdings  by  a  special  limi- 
tation. Now  the  theory  of  free  trade  was  precisely  that  which 
at  the  moment  possessed  the  heads  of  the  Prussian  doctrinaires 
under  the  influence  of  Kraus,  and  it  was  precisely  that  of  which 
Schon  was  the  mouth -piece  on  the  Immediate  Commission. 
"  Kraus,"  says  Schon  himself,  "  was  my  great  teacher;  he  mas- 
tered me  entirely,  and  I  followed  him  without  reserve."  The 
theory  was  still  so  new,  that  it  is  not  likely  that  the  Prussian 
legislators  could  have  adopted  it  with  such  courageous  complete- 
ness as  they  did  in  the  Emancipating  Edict  unless  there  had  been 
among  them  some  strongly  convinced  free-trader,  whose  argu- 
ments were  heard  at  the  Immediate  Commission.  Schon's  influ- 
ence is  necessary  to  account  for  the  result,  and  we  can  fancy 
how  hard  and  ruthless  his  language  must  sometimes  have  sounded, 
particularly  to  one  so  timid  by  temperament  as  Niebuhr.  Thus 
Niebuhr's  evidence  and  the  nature  and  known  facts  of  the 
case  concur  to  show  us  Schon  advocating  with  all  his  influence, 
and  with  more  energy  than  any  one  else,  that  part  of  the  Edict 
which  introduces  free  trade  in  land. 

On  the  other  hand  we  do  not  expect  to  be  told  that  Schon  had 
much  influence  in  deciding  the  Commission  to  propose  the  abo- 
lition of  serfdom,  not  because  he  did  not  feel  strongly  on  the 
question,  but  because  there  was  no  difference  of  opinion  about 
it.  How  did  we  find  Hardenberg  treating  this  subject?  "The 
abolition  of  serfdom,"  he  wrote,  "  must  be  decreed  by  a  law 
briefly,  and  at  once."  In  other  words,  it  is  a  matter  on  which 
argument  has  long  been  exhausted.  That  this  was  really  the 
case,  that,  to  use  the  vigorous  words  of — what  writer?  —  of 
Schon  himself:  — 

"  The  great  majority  of  the  nation,  a  few  weak  and  wicked 
persons  only  excepted,  have  long  been  agreed  upon  the  principle 
that  there  is  no  greater  injustice  than  that  a  reasonable  being 
should  be  prevented  from  using  his  energies  for  his  own  welfare 
in  a  way  not  prejudicial  to  the  State,  by  a  fellow-subject,  simply 
because  he  was  born  on  this  or  that  clod,"  all  evidence  concurs 
to  show.  To  abolish  serfdom  had  been  a  favorite  object  of  Fred- 
erick William  III.  since  his  accession,  "  towards  which,"  as  he 
himself  said  in  his  Cabinet  Order  of  August  23d,  "  he  had  un- 
deviatingly  striven."  The  question  had  been  agitated  in  every 
way,  in  the  Estates  of  West  Prussia  as  early  as  1799,  in  writings 
by  Kraus,  Leopold  Krug,  and  others  ;  Stein  himself,  as  has  been 


92  SELECTIONS. 

remarked  above,  had  been  busy  with  it  in  Westphalia.  A  good 
notion  of  the  general  state  of  public  opinion  on  .the  subject  may 
be  formed  from  the  following  statement  given  in  Bassewitz's 
"  State  of  the  Electoral  Mark  of  Brandenburg  in  1806"  :  — 

"  Though  the  peasant,  used  to  routine,  had,  in  his  fettered  con- 
dition, little  industry,  and  did  not  yet  appreciate  the  advantages 
which  were  offered  him  for  the  future  in  a  perfectly  free  proprie- 
torship, yet  he  felt  keenly  enough  the  pressure  of  the  service-pay- 
ments, and  of  the  compulsory  service.  This,  and  the  views  of 
the  rights  of  man  that  were  diffused  among  the  people,  created 
among  the  peasantry  the  wish  to  be  relieved  from  their  services, 
from  their  dependence  on  the  landlords,  and  from  the  compulsory 
menial  service,  as  it  subsisted  under  the  Servants  Ordinance 
(Gesinneordnung)  for  the  country  districts  of  the  Electoral  Mark 
of  Feb.  ii,  1769,  and  the  later  interpretations  of  it." 

Now  what  startles  us  in  Schon's  reminiscences  and  excites  the 
suspicion  that  he  does  not  merely  exaggerate,  but  deliberately 
distorts  and  misrepresents  the  truth,  is  this,  that  he  describes 
himself  as  having  carried  the  abolition  of  serfdom  in  spite  of 
general  opposition,  while  he  is  not  only  silent  about  his  exertions 
in  the  cause  of  free  trade,  but  endeavors  by  studied  turns  of 
language  to  convey  the  impression  that  he  took  no  interest  in 
that  question.  What  curious  freak  of  vanity  can  have  actuated 
him  we  can  only  guess  ;  I  suppose  he  thought  the  glory  of  a 
liberator  of  bondsmen  more  desirable  than  a  mere  reputation  for 
enlightened  views  of  political  economy.  It  is,  however,  the  fact 
that  he,  the  enthusiastic  disciple  of  Kraus,  describes  one  of  the 
most  memorable  triumphs  of  the  free  trade  theory  in  such  a 
way  that  it  can  only  be  discovered  from  a  single  casual  expres- 
sion that  free  trade  triumphed  at  all.  Meanwhile  he  describes 
his  zeal  for  the  abolition  of  serfdom  as  resembling  that  of  a  mar- 
tyr or  apostle,  and  has  a  pathetic  picture  of  his  own  devotedness, 
when,  as  he  was  engaged  in  composing  his  report,  he  received 
intelligence  that  his  wife  was  at  the  point  of  death,  if  he  would 
see  her  again  alive  he  must  leave  his  work  and  huny  to  her  side  ; 
but,  "  though  deeply  afflicted,  he  felt  he  must  not  betray  the  great 
idea,  and  with  violent  self-mastery,  wrote  on  till  his  task  was 
ended,  and  then  setting  out,  found  his  wife,  the  angel  that  hov- 
ered over  him,  no  longer  living."  And  he  repeats  several  times 
that  this  had  been  "  his  sole  and  single  object  in  public  life,"  that 
"  he  had  desired  only  this,"  which  assertions  of  course  imply,  and 


EMANCIPATING   EDICT   OF   STEIN.  93 

seem  intended  to  imply,  that  he  had  never  taken  the  smallest 
interest  in  free  trade.  Equally  strong  are  his  assertions  that  the 
abolition  of  serfdom  was  owing  to  his  own  efforts.  The  reform 
is  described,  not  as  one  about  the  desirableness  of  which  all 
were  agreed,  not  as  one  which  had  long  been  agitated  and  over 
every  part  of  the  monarchy,  which  the  king  had  always  had  at 
heart,  and  the  peasantry  themselves  were  eagerly  looking  for- 
ward to,  but  in  a  strain  which  might  have  suited  the  Abolition  of 
the  Slave  Trade  by  Clarkson  and  Wilberforce.  It  is  a  grand 
philanthropic  idea  conceived  by  a  few  Konigsberg  philosophers 
and  diffused  from  them  to  a  band  of  faithful  disciples,  but 
remaining  for  a  long  time  a  doctrine  peculiar  to  the  Prussian 
province,  so  that  it  "  seemed  a  mere  brain-cobweb  to  Westpha- 
lians  and  Markers.''  This  idea  he  personally  has  the  glory  of 
representing  in  the  Immediate  Commission.  Stagemann  is  the 
first  convert,  then  Beyme  raises  himself  to  the  level  of  the  Idea, 
his  conversion  being  helped  by  the  authority  of  another  Konigs- 
berger,  Morgenbesser ;  Klewitz  is  the  last  to  come  in.  While 
the  abolition  of  serfdom  required  so  much  preaching,  the  doc- 
trines of  free  trade,  we  are  asked  to  believe,  were  received  as  a 
matter  of  course.  But  in  the  moment  of  his  triumph  this  Prus- 
sian Wilberforce  sank  down  exhausted ;  no  sooner  was  the  strug- 
gle over  than  the  sense  of  his  bereavement  overcame  him. 
Accordingly  he  could  not  draught  the  law,  —  here  at  least  is  an 
important  statement,  — and  Stagemann,  "  faithful  companion  on 
the  great  journey,"  undertook  this  task.  "All  else  that  I  have 
done  in  the  world  is  nothing  compared  to  calling  into  life  the 
idea  of  freedom."  And  this  hymn  to  himself  Schon  introduces 
with  the  mock-modest  heading,  What  did  I  do?  Answer: 
Nothing  worth  speaking  of. 

The  report  which  cost  Schon  such  "violent  self-mastery"  is 
now  before  us,  and  we  cannot  read  it  without  feeling  that  the 
Frau  v.  Schon  was  somewhat  hardly  used.  It  is  from  this  very 
report  that  I  have  just  extracted  the  statement,  that  "  the  great 
majority  of  the  nation  had  long  been  agreed  on  the  principle  of 
the  abolition  of  serfdom."  So  far  from  arguing  strongly  and 
eloquently  against  serfdom,  so  far  from  directing  his  argument 
principally  to  this  point,  he  puts  serfdom  last  among  six  causes 
to  which  he  refers  the  impoverishment  of  the  country.  He 
does  indeed  describe  it  as  the  most  important  of  the  six,  but  he 
refrains  from  treating  it  with  the  same  fulness  as  the  others, 


94  SELECTIONS. 

because,  as  he  says,  "  on  the  necessity  and  safety  of  abolishing  it 
Your  Majesty  has  heard  so  much  that  it  would  tire  you  to  hear 
more."  And  in  the  short  preface  which  he  has  prefixed  to  the 
Report  he  says  expressly  :  — 

"  This  matter  (/.  e.,  the  abolition  of  serfdom)  had  occupied 
all  good  heads  and  hearts  in  Prussia  many  years  before  the  war. 
The  number  of  those  who  were  slavishly  disposed  was  small,  but 
they  were  powerful." 

At  the  same  time  it  refutes  the  reminiscences  not  less  com- 
pletely on  the  subject  of  free  trade  in  land.  It  shows,  as  we 
should  expect,  that  Schon's  mind  is  fully  occupied  with  this 
question,  and  that  he  gives  it  precedence  over  the  question  of  the 
abolition  of  serfdom.  We  find  in  this  report  just  those  hard 
and  cruel-sounding  statements  of  economic  principle  which 
Niebuhr  had  led  us  to  expect.  We  find  him  attacking  as  a 
mischievous  prejudice  the  accepted  rule  that  the  number  of  peas- 
ant-holdings on  an  estate  should  never  be  diminished,  and  declar- 
ing that  "  there  is  no  reason  why  the  land-owner  should  not  have 
an  unlimited  right  to  dispose  at  pleasure  of  his  land  and  soil,"  and 
that,  "  as  a  matter  of  fact  it  would  be  found  impossible  to  keep  up 
as  many  peasant-holdings  as  before  the  war,"  and  throwing  out 
hard  assertions  that  "  the  government  can  never  have  an  interest 
in  securing  A  or  B  in  the  possession  of  his  property."1 

It  is,  however,  a  mistake  to  suppose  that  Stein's  reputation  is 
in  any  way  concerned  in  the  question  of  the  trustworthiness  of 
Schon's  account.  Schon's  sphere  was  the  Immediate  Commis- 
sion, while  Stein's  sphere  was  altogether  outside  it.  What 
Schon  has  snatched  at  is  not  any  reputation  belonging  to  Stein, 
but  that  which  ought  to  fall  to  his  colleagues,  Sta'gemann, 
Klewitz,  and  in  some  degree  also  Altenstein  and  Niebuhr.  An 
achievement  which  officially  belonged  to  the  whole  Commission 
jointly  he  has  tried  to  appropriate  in  the  main  to  himself.  For- 
tunately evidence  enough  remains  to  defeat  this  attempt,  and  to 
show  that  the  only  statement  in  his  whole  narrative  which  we 
can  safely  accept  is  the  statement  that  the  draughting  of  the 
Edict  was  the  work  of  Stagemann.  As  to  Stein,  his  share  in  the 

1  I  have  carefully  avoided  depending-  upon  the  narrative  given  in  Pertz  of  the  party- 
contest  at  the  Immediate  Commission,  which  I  agree  with  the  anonymous  author  of  "  Zu 
Schutz  undTrutz  am  Grabe  Schbns"  in  regarding  as  somewhat  legendary.  I  trust  I  have 
made  it  appear  that  the  statements  of  Schon's  Autobiography  can  be  disproved  without 
assuming  the  truth  of  a  narrative  equally  unsatisfactory  that  has  unfortunately  crept  into 
Pertz,  and  in  any  case  that  Stein  is  not  at  all  concerned  in  the  controversy. 


EMANCIPATING   EDICT   OF   STEIN.  95 

achievement  is  altogether  distinct  from  that  of  the  Commission, 
and,  therefore,  from  that  of  any  member  of  the  Commission.  It 
is  to  be  divided  into  two  parts,  of  which  the  one  can  be  pre- 
cisely stated,  and  the  other  is  essentially  indefinable,  though  not 
necessarily  the  smaller  on  that  account. 

The  first  consists  in  any  alterations  he  may  have  made  in  the 
Edict  after  it  was  laid  before  him.  Of  these  the  principal  was 
the  extension  of  the  Edict  to  all  the  provinces  of  the  monarchy. 
That  the  credit  of  this  belongs  to  Stein  we  find  Schon  himself, 
who,  when  he  wrote  his  Autobiography,  had  formed  the  habit 
of  denying  him  all  share  in  the  Edict  beyond  that  of  putting  his 
name  to  it,  fully  acknowledging  while  the  facts  were  still  fresh 
in  memory.  In  a  diary  written  about  the  time  of  Stein's  fall 
Schon  writes  of  him  :  "  He  made  his  debut  with  the  Edict  of 
October,  which  he  found  ready,  and  which  it  is  his  merit  only  to 
have  made  universal.  Besides  this,  as  we  have  seen,  the  incor- 
poration of  Stagemann's  suggestion  into  Art.  6  is  due  to  Stein. 

But  it  is  strangely  perverse  to  limit  Stein's  share  in  the  Edict 
to  those  alterations  in  the  text  of  it  which  are  known  to  be  due 
to  him.  It  is  not  thus  that  the  merit  of  an  act  of  legislation 
ought  to  be,  or  commonly  is,  awarded.  When  Lord  Grey  is 
called  the  author  of  the  Reform  Bill,  is  it  intended  that  he  first 
thought  of  reforming  Parliament,  or  that  he  devised  and  draughted 
all  or  most  of  the  provisions  of  the  bill?  Plainly  his  title  to  the 
achievement  would  be  entirely  unaffected  if  it  could  be  shown 
that  no  single  word  of  the  bill  was  suggested  or  determined  by 
him.  It  is  not  draughting  a  bill,  but  passing  it,  that  is  the 
difficulty.  What  we  say  of  Lord  Grey  is  that  he  gained  that 
ascendency  both  in  his  own  party  and  in  the  nation  by  the  height 
and  firmness  of  his  character,  that  he  was  able  to  guide  them 
safely  through  a  legislative  enterprise  which,  with  an  inferior 
leader,  they  would  either  have  feared  to  attempt,  or,  in  attempt- 
ing, would  have  stumbled  into  revolution  and  civil  bloodshed. 
When  we  call  the  Edict  of  October  Stein's  Edict  we  mean  some- 
thing similar.  But  it  may  be  thought  that  the  cases  were  not 
parallel,  because  in  Prussia  there  was  no  parliament  to  guide,  no 
turbulent  public  opinion  to  control.  And,  indeed,  I  imagine  that 
no  one  would  pretend  to  equal  this  single  act  of  Stein's  to  the 
passing  of  the  Reform  Bill.  Still,  between  the  draughting  of  the 
Emancipating  Edict  and  the  making  it  law  in  Prussia  there  was 
a  space  to  be  traversed,  though  not  so  wide  a  space  as  that  over 


96  SELECTIONS. 

which  Lord  Grey  carried  the  Reform  Bill.  Not  a  parliament  or 
a  people,  but  officials  and  the  king,  had  to  be  inspired  with  cour- 
age. No  noisy  parliamentary  opposition  indeed,  but  tenacious 
interests  exceedingly  strong  in  the  court  and  in  the  army  had  to 
be  defied.  When  Hardenberg  and  Altenstein  and  the  Com- 
mission recommended  these  reforms,  they  did  so  with  the  knowl- 
edge that  Stein  was  at  hand  to  carry  them  out.  Would  they 
have  made  the  same  suggestions  if  Voss  or  Schulenburg  or 
Struensee  had  been  at  the  head  of  affairs?  Hardenberg's  recom- 
mendations proceed  avowedly  upon  the  assumption  that  Stein  is 
to  be  minister,  and  we  cannot  even  be  sure  that  he  would  him- 
self have  had  courage  to  attempt  what  he  felt  sure  Stein  would 
not  shrink  from.  Much  more  may  we  doubt  whether  the  king 
would  have  borne  the  weight  of  such  responsibility  unsupported, 
or  supported  only  by  a  common  minister. 

In  one  word,  we  must  not  confound  the  reforming  legislator 
with  the  jurist  and  parliamentary  draughtsman.  It  is  not  inven- 
tiveness, or  originality,  or  technical  skill,  thit  we  honor  in  those 
who  have  presided  over  the  transitions  of  States.  It  is  chiefly 
the  massive  courage  that  moves  freely  under  responsibility  and 
lightens  the  burden  of  responsibility  to  all  around ;  it  is  the 
"  Atlantean  shoulders." 

On  these  principles  we  ought  perhaps  to  regard  the  rapidity 
with  which  Stein  hurried  the  reform  through  as  an  essential  and 
principal  part  of  the  reform  itself.  It  was  most  material  that  the 
nation  should  feel  the  stay  and  sway  of  a  powerful  hand.  Stein 
always  acted  with  an  almost  Napoleonic  swiftness,  but  in  this 
instance  we  are  particularly  struck  with  his  pi'omptitude.  It  was 
perhaps  rather  instinctive  than  calculated,  and  yet  he  may  have 
been  aware  of  the  importance  of  justifying  without  a  moment's 
delay  the  great  expectations  that  had  been  formed  of  him.  He 
receives  his  powers  on  October  4th,  and  on  the  9th  the  most 
comprehensive  measure  ever  passed  in  Prussia,  affecting  every 
class  and  the  whole  framework  of  society,  appears,  not  as  a  pro- 
posal, but  as  an  accomplished  act  with  the  king's  signature,  as 
a  part  of  the  law  of  the  country. 


THE    ORDERS    IN    COUNCIL.  97 

VI. 

THE   ORDERS   IN   COUNCIL. 
FROM  LEVI'S  HISTORY  OF  BRITISH  COMMERCE  (20  ED.),  PP.  101-120. 

THE  political  horizon  was  ominously  darkening  at  the  com- 
mencement of  the  nineteenth  century.  Whilst  grievously  suffer- 
ing from  the  high  prices  of  corn  and  provisions,  and  oppressed 
by  the  burden  of  a  contest  already  sufficiently  prolonged,  England 
was  threatened  by  the  renewal  of  another  armed  neutrality  on  the 
part  of  the  Northern  powers,  —  a  neutrality  based  on  a  new  code 
of  maritime  law,  then  deemed  utterly  inconsistent  with  the  rights 
of  this  country.  The  Northern  powers  wished  to  proclaim  that 
free  ships  should  make  free  goods  ;  but  England  was  determined 
that  the  trade  of  the  enemy  should  not  be  carried  on  by  neutrals. 
The  Northern  powers  asserted  that  only  contraband  goods  should' 
be  excluded  from  the  trade  of  neutrals,  and  these  of  certain  defi- 
nite and  known  articles.  England  did  not  wish  the  enemy  to' 
obtain  timber,  hemp,  and  other  articles,  which,  though  not  con- 
traband of  war,  are  still  essential  for  warfare.  The  Northern 
powers  declared  that  no  blockade  should  be  held  valid  unless 
real.  England  had  already  assumed  the  right  to  treat  whole 
coasts  as  blockaded,  in  order  to  prevent  the  enemy  receiving  sup- 
plies from  any  quarter.  And  when  the  Northern  powers  added 
that  a  merchant  vessel  accompanied  and  protected  by  a  belligerent 
ship  ought  to  be  safe  from  the  right  of  search,  England  was  not 
prepared  to  recognize  the  authority  of  such  ships,  and  would 
place  no  limit  to  the  action  of  her  cruisers.  When,  therefore, 
Russia,  Denmark,  and  Sweden  entered  into  a  convention  to 
enforce  the  principles  of  the  armed  neutrality,  and,  in  pursuance 
of  the  same,  Russia  caused  an  embargo  to  be  laid  on  all  British. 
vessels  in  her  ports,  the  British  Government,  ill-disposed  to  bear 
with  such  provocation,  issued  a  proclamation  on  Jan.  14,  1801, 
authorizing  reprisals,  and  laying  an  embargo  on  all  Russian, 
Swedish,  and  Danish  vessels  in  British  ports.  What  followed  is. 
well  known,  and  with  the  battle  of  Copenhagen  the  Northern 
confederacy  was  completely  dissolved.  By  this  time  Mr.  Pitt  had 
given  in  his  resignation,  and  a  change  of  government  took  place, 


98  SELECTIONS. 

which  led  to  a  change  of  policy  towards  France,  and  to  negotia- 
tions which  ended  with  the  conclusion  of  the  treaty  of  Amiens.1 

But,  alas  !  from  whatever  cause  it  was,  that  peace  was  of  short 
duration,  and,  more  than  ever,  the  patriotic  spirit  of  the  people 
was  evoked  to  defend  British  soil  against  Britain's  inveterate 
enemies.2  From  class  to  class  the  national  enthusiasm  spread 
and  increased,  and  even  the  merchants,  setting  aside  their  books 
and  business,  issued  a  declaration,  promising,  in  a  solemn  manner, 
to  use  every  exertion  to  rouse  the  spirit  and  to  assist  the  resources 
of  the  kingdom  ;  to  be  ready  with  their  services  of  every  sort  and 
on  everv  occasion  in  its  defence  ;  and  rather  to  perish  altogether 
than  live  to  see  the  honor  of  the  British  name  tarnished,  or  that 
sublime  inheritance  of  greatness,  glory,  and  liberty  destroyed, 
which  descended  to  them  from  their  forefathers,  and  which  they 
were  determined  to  transmit  to  their  posterity.  Again  was  Mr. 
Pitt  called  to  be  prime  minister,  as  the  only  man  who  could  really 
be  trusted  in  times  of  so  much  anxiety  and  peril.  And  then  it 
was  that  that  continental  system  was  inaugurated,  which  made  of 
oceans  and  seas  one  vast  battlefield  of  strife  and  bloodshed. 

Fully  to  understand  the  policy  of  this  country  as  regards  these 
orders  in  council,  we  must  briefly  retrace  our  steps,  by  examining 
the  measures  taken  in  previous  wars.  During  the  Seven  Years' 
War,  which  ended  in  1763,  France  hemmed  in  on  all  sides  by 
England,  and  hindered  by  the  British  naval  force  from  carrying 
on  any  trade  with  her  West  India  colonies,  adopted  the  plan  of 
relaxing  her  colonial  monopoly,  and  allowing  neutral  ships  to 
carry  the  produce  of  those  islands  to  French  or  foreign  ports  in 
Europe.  The  produce  being  thus  carried  really  or  ostensibly  on 
neutral  account,  it  was  assumed  that  no  danger  of  capture  could 
be  incurred.  But  the  prize  courts  of  England  condemned  such 
vessels  as  were  captured  while  engaged  in  the  trade,  and  the  rule 
was  then  adopted,  called  the  rule  of  1756,*  that  a  neutral  has  no 

1  Peace  was  ratified  on  October  10,  1801;  and  the  treaty  of  Amiens  was  concluded  March 
25,  iSoa. 

*  On  May  16,  1803,  an  order  in  council  was  made,  issuing  letters  of  marque  and  reprisals 
against  France,  and  another  laying  an  embargo  on  all  ships  belonging  to  the  French  and 
Batavian  republics.  Reprisals  against  Spain  were  ordered  December  19,  1805;  against 
Prussia  on  May  14,  1806;  and  against  Russia  on  December  18,  1807. 


THE   ORDERS   IN   COUNCIL.  99 

right  to  deliver  a  belligerent  from  the  pressure  of  his  enemy's 
hostilities  by  trading  with  his  colonies  in  time  of  war  in  a  way 
that  was  prohibited  in  time  of  peace.  As  Sir  William  Scott  said, 
"  The  general  rule  is.  that  the  neutral  has  a  right  to  carry  on  in 
time  of  war  his  accustomed  trade  to  the  utmost  extent  of  which 
that  accustomed  trade  is  capable.  Very  different  is  the  case  of  a 
trade  which  the  neutral  has  never  possessed;  which  he  holds  by 
no  title  of  use  and  habit  in  time  of  peace  ;'and  which,  in  fact,  he 
can  obtain  in  war  by  no  other  title  than  by  the  success  of  the  one 
belligerent  against  the  other,  and  at  the  expense  of  that  very  bellig- 
erent under  whose  success  he  sets  up  his  title."  During  the 
American  war  this  principle  did  not  come  practically  into  action, 
because,  although  then  also  the  French  government  opened  the 
ports  of  her  West  India  islands  to  the  ships  of  neutral  powers,  it 
had  the  wisdom  to  do  so  before  hostilities  were  commenced,  and 
not  after. 

In  accordance  with  these  principles,  when  the  war  of  the 
French  Revolution  commenced,  instructions  were  given,  on 
Nov.  6,  1793,  to  the  commanders  of  British  ships  of  war 
and  privateers,  ordering  them  "  to  stop  and  detain  for  lawful 
adjudication  all  vessels  laden  with  goods,  the  produce  of  any 
French  colony,  or  carrying  provisions  or  other  supplies  for  the 
use  of  any  such  colony."  And  this  order  was  the  more  necessary 
from  the  fact  that  American  ships  were  crowding  the  ports  of  the 
French  West  Indies,  where  the  flag  of  the  United  States  was 
made  to  protect  the  property  of  the  French  planters.  Great 
numbers  of  ships  under  American  colors  were  thus  taken  in  the 
West  Indies  and  condemned,  the  fraudulent  pretences  of  neutral 
property  in  the  cargoes  being  too  gross  to  be  misunderstood. 
Complaints  were,  however,  made  of  the  hardship  of  this  practice 
on  the  bond-fide  American  trader,  and  in  January,  1794*  the 
instructions  were  so  far  amended  that  the  direction  was  to  seize 
"  such  vessels  as  were  laden  with  goods  the  produce  of  the 
French  West  India  Islands,  and  coming'  directly  from  any  ports 
of  the  said  islands  to  Europe"  This  rule  continued  in  force 
till  1798,  when  again  it  was  relaxed,  by  ordering  that  vessels 
should  be  seized  "laden  with  the  produce  of  any  island  or  settle- 
ment of  France,  Spain,  or  Holland,  and  coming  directly  from 
any  port  of  the  said  island  or  settlement  to  any  port  in  Europe, 
not  being  a  port  of  this  kingdom,  or  of  the  country  to  which  the 
vessel,  being  neutral,  should  belong."  European  neutrals  were 


100  SELECTIONS. 

thus  permitted  to  bring  the  produce  of  the  hostile  colonies  from 
thence  to  ports  of  their  own  countries;  and  European  or  American 
neutral  ships  might  carry  such  produce  direct  to  England.  But 
when  the  war  was  resumed  in  1803,  the  rule  of  1798  was  again 
put  in  force,  and  instructions  were  given  "not  to  seize  any 
neutral  vessels  which  should  be  found  carrying  on  trade  directly 
between  the  colonies  of  the  enemy  and  the  neutral  country  to 
which  the  vessel  belonged,  and  laden  with  property  of  the  in- 
habitants of  such  neutral  country,  provided  that  such  neutral 
vessel  should  not  be  supplying,  nor  should  have  on  the  outward 
vovage  supplied,  the  enemy  with  any  articles  of  contraband  of 
war,  and  should  not  be  trading  with  any  blockaded  ports." 

By  thus  allowing,  however,  neutrals  to  trade  safely  to  and  from 
neutral  ports,  means  were  opened  to  them  to  clear  out  for  a  neutral 
port,  and  under  cover  of  that  pretended  destination  to  make  a 
direct  voyage  from  the  colony  to  the  parent  state,  or  really  to 
proceed  to  some  neutral  country,  and  thence  reexport  the  cargo 
in  the  same  or  a  different  bottom  to  whichever  European  market, 
neutral  or  hostile,  they  might  prefer.  The  former,  on  an  assumed 
vovage  to  the  parent  State,  being  the  shortest  and  most  convenient 
method,  was  chiefly  adopted  by  the  Dutch  on  their  homeward 
voyages,  because  a  pretended  destination  for  Prussian,  Swedish, 
or  Danish  ports  in  the  North  Sea,  or  the  Baltic,  was  a  plausible 
mask,  even  in  the  very  closest  approach  the  ship  might  make  to 
the  Dutch  coast  down  to  the  moment  of  her  slipping  into  port. 
The  latter  method,  or  the  stopping  at  an  intermediate  neutral 
country,  was  commonly  preferred  by  the  Spaniards  and  French 
in  bringing  home  their  colonial  produce,  because  no  pretended 
neutral  destination  could  be  given  that  would  consist  with  the 
geographical  position  and  course  of  a  ship  coming  directly  from 
the  West  Indies,  if  met  with  near  the  end  of  her  voyage  in  the 
latitude  of  their  principal  ports.  The  American  flag  in  particular 
was  a  cover  that  could  scarcely  ever  be  adapted  to  the  former 
method  of  eluding  our  hostilities,  but  it  was  found  peculiarly 
.convenient  in  the  latter.  Such  is  the  position  of  the  United 
States,  and  such  was  the  effect  of  the  trade-winds,  that  European 
vessels,  homeward  bound  from  the  West  Indies,  could  touch  at 
their  ports  with  very  little  inconvenience  or  delay  ;  and  such  was 
also  the  case,  though  in  a  less  degree,  with  regard  to  vessels 
coming  from  the  remotest  parts  of  South  America  or  the  East 
Indies.  The  passage  from  the  Gulf  of  Mexico,  especially,  runs 


THE  ORDERS  IN  COUNCIL.  IOI 

so  close  along  the  North  American  shore  that  ships  bound  from 
the  Havannah,  from  Vera  Cruz,  and  other  great  Spanish  ports 
-bordering  on  that  gulf,  to  Europe,  could  touch  at  certain  ports  in 
the  United  States  with  scarcely  any  deviation.  On  an  outward 
voyage  to  the  East  and  West  Indies  the  proper  course  would  be 
more  to  the  southward  than  would  well  consist  with  touching  on 
North  America  ;  yet  the  deviation  for  that  purpose  was  not  a  very 
formidable  inconvenience.  From  these  causes  the  protection 
given  by  the  American  flag  to  the  intercourse  between  our 
European  enemies  and  their  colonies  was  chiefly  in  the  way  of 
a  double  voyage,  in  which  America  was  the  half-way  house  or 
central  point  of  communication.  The  fabrics  and  commodities 
of  France,  Spain,  and  Holland  were  brought  under  American 
colors  to  ports  in  the  United  States,  and  from  thence  reexpoi  ted, 
under  the  same  flag,  for  the  supply  of  the  hostile  colonies. 
Again,  the  produce  of  these  colonies  was  brought  in  a  like  man- 
ner to  the  American  ports,  and  thence  reshipped  to  Europe. 
But  the  Americans  went  still  farther.  The  ports  of  this  kingdom 
having  been  constituted,  by  the  royal  instructions  of  1798,  legiti- 
mate places  of  destination  for  neutrals  coming  with  cargoes  of 
produce  directly  from  the  hostile  colonies,  the  American  mer- 
chants made  a  pretended  destination  to  British  ports  a  convenient 
cover  for  a  voyage  from  the  hostile  colonies  to  Europe,  which 
their  flag  could  not  otherwise  give,  and  thus  rivalled  the  neutrals 
of  the  old  world  in  this  method  of  protecting  the  West  India 
trade  of  the  enemy,  while  they  nearly  engrossed  the  other.  As 
the  war  advanced,  after  the  Peace  of  Amiens,  the  neutrals  be- 
came bolder  and  more  aggressive.  American  ships  were  con- 
stantly arriving  at  Dutch  and  French  ports  with  sugar,  coffee, 
and  other  productions  of  the  French  and  Spanish  West  Indies. 
And  East  India  goods  were  imported  by  them  into  Spain,  Hol- 
land, and  France. 

By  these  and  other  means,  Hamburgh,  Altona,  Emden,  Got- 
tenburgh,  Copenhagen,  Lisbon,  and  other  neutral  markets  were 
glutted  with  the  produce  of  the  West  Indies  and  the  fabrics  of  the 
East,  brought  from  the  prosperous  colonies  of  powers  hostile  to 
this  country.  By  the  rivers  and  canals  of  Germany  and  Flanders 
these  were  floated  into  the  warehouses  of  the  enemy,  or  circulated 
for  the  supply  of  his  customers  in  neutral  countries.  He  rivalled 
the  British  planter  and  merchant  throughout  the  continent  of 
Europe,  and  in  all  ports  of  the  Mediterranean,  and  even  sup- 


102  SELECTIONS. 

planted  the  manufacturers  of  Manchester,  Birmingham,  and 
Yorkshire ;  and  by  these  means  the  hostile  colonies  derived 
benefit,  and  not  inconvenience,  from  the  enmity  of  Great  Britain. 
What,  moreover,  especially  injured  the  commerce  of  this  country, 
was  the  increase  in  the  cost  of  importation  into  this  country  from 
the  British  colonies,  from  freight,  insurance,  and  other  charges, 
which,  taken  together,  were  as  much  as,  if  not  superior  to,  those 
to  which  the  enemy  was  subjected  in  his  covert  and  circuitous 
trade.  It  ,was  a  general  complaint,  therefore,  that  the  enemy 
carried  on  colonial  commerce  under  the  neutral  flag  cheaply,  as 
well  as  safely  ;  that  he  was  enabled  not  only  to  elude  our  hostili- 
ties, but  to  rival  our  merchants  and  planters  in  the  European 
markets ;  that  by  the  same  means  the  hostile  treasuries  were 
filled  with  a  copious  stream  of  revenue  ;  and  that  bv  this  licen- 
tious use  of  the  neutral  flag,  the  enemy  was  enabled  to  employ  his 
whole  military  marine  in  purposes  of  offensive  war,  without  being 
obliged  to  maintain  a  squadron  or  a  ship  for  the  defence  of  their 
colonial  ports.  It  was,  moreover,  contended  that,  since  neutral 
states  have  no  right,  but  through  our  own  gratuitous  concession, 
to  carry  on  the  colonial  trade  of  the  enemy,  we  might,  after  a 
reasonable  notice,  withdraw  that  ruinous  indulgence  ;  that  the 
comparative  cheapness  of  his  navigation  gives  him,  in  every 
open  market,  a  decisive  advantage  ;  that  in  the  commerce  of  other 
neutral  countries  he  could  not  fail  to  supplant  the  belligerent ; 
and  that  he  obtained  an  increase  of  trade  by  purchasing  from  one 
belligerent,  and  selling  to  his  enemies  the  merchandise  for  which, 
in  time  of  peace,  they  depended  on  each  other. 

Such  complaints  made  against  neutral  states  found  a  powerful 
echo  by  the  publication  of  a  work  entitled  "  War  in  Disguise 
and  the  Frauds  of  the'  Neutral  Flag,"  supposed  to  have  been 
written  by  Mr.  James  Stephen,  the  real  author  of  the  orders  in 
council.  The  British  government  did  not  see  its  way  at  once  to 
proceed  in  the  direction  of  prohibiting  to  neutral  ships  the  colo- 
nial trade,  which  they  had  enjoyed  for  a  considerable  time  ;  but 
the  first  step  was  taken  to  paralyze  the  resources  of  the  enemy, 
and  to  restrict  the  trade  of  neutrals,  by  the  issue  of  an  order  in 
council  in  May,  1806,  declaring  that  all  the  coasts,  ports,  and 
rivers  from  the  Elbe  to  Brest  should  be  considered  blockaded, 
though  the  only  portion  of  those  coasts  rigorously  blockaded  was 
that  included  between  Ostend  and  the  mouth  of  the  Seine,  in  the 
ports  of  which  preparations  were  made  for  the  invasion  of  Eng- 


THE   ORDERS    IN   COUNCIL.  1 03 

land.     The  northern   ports   of  Germany  and   Holland  were  left 
partly  open,  and  the  navigation  of  the  Baltic  altogether  free. 

Napoleon,  then  in  the  zenith  of  his  power,  saw,  in  this  order 
in  council,  a  fresh  act  of  wantonness,  and  he  met  it  by  the  issue 
of  the  Berlin  decree  of  Nov.  21,  1806.  In  that  document, 
remarkable  for  its  boldness  and  vigor,  Napoleon  charged  Eng 
land  with  having  set  at  naught  the  dictates  of  international  law, 
with  having  made  prisoners  of  war  of  private  individuals,  and 
with  having  taken  the  crews  out  of  merchant  ships.  He  charged 
this  country  with  having  captured  private  property  at  sea,  ex- 
tended to  commercial  ports  the  restrictions  of  blockade  applica- 
ble only  to  fortified  places,  declared  as  blockaded  places  which 
were  not  invested  by  naval  forces,  and  abused  the  right  of  block- 
ade in  order  to  benefit  her  own  trade  at  the  expense  of  the  com- 
merce of  continental  states.  He  asserted  the  right  of  combating 
the  enemy  with  the  same  arms  used  against  himself,  especially 
when  such  enemy  ignored  all  ideas  of  justice,  and  every  liberal 
sentiment  which  civilization  imposes.  He  announced  his  resolu- 
tion to  apply  to  England  the  same  usages  which  she  had  estab- 
lished in  her  maritime  legislation.  He  laid  down  the  principles 
which  France  was  resolved  to  act  upon  until  England  should 
recognize  that  the  rights  of  war  are  the  same  on  land  as  on  sea, 
that  such  rights  should  not  be  extended  either  against  private 
property  or  against  persons  not  belonging  to  the  military  or  naval 
forces,  and  that  the  right  of  blockade  should  be  restricted  to  for- 
tified places,  truly  invested  by  sufficient  forces.  And  upon  these 
premises  the  decree  ordered,  ist,  That  the  British  islands  should 
be  declared  in  a  state  of  blockade.  2d,  That  all  commerce  and 
correspondence  with  the  British  islands  should  be  prohibited  ; 
and  that  letters  addressed  to  England  or  Englishmen,  written  in 
the  English  language,  should  be  detained  and  taken.  3d,  That 
every  British  subject  found  in  a  country  occupied  by  French 
troops,  or  by  those  of  their  allies,  should  be  made  a  prisoner 
of  war.  4th,  That  all  merchandise  and  property  belonging  to 
British  subjects  should  be  deemed  a  good  prize.  5th,  That  all 
commerce  in  English  merchandise  should  be  prohibited,  and  that 
all  merchandise  belonging  to  England  or  her  colonies,  and  of 
British  manufacture,  should  be  deemed  a  good  prize.  And,  6th, 
That  no  vessel  coming  direct  from  England  or  her  colonies  be 
allowed  to  enter  any  French  port,  or  any  port  subject  to  French 
authority ;  and  that  every  vessel  which,  by  means  of  a  false 


IO4  SELECTIONS. 

declaration,  should  evade  such  regulations' should  at  once  be 
captured. 

The  British  government  lost  no  time  in  retaliating  against 
France  for  so  bold  a  course  ;  and  on  Jan.  7,  1807,  an  order  in 
council  was  issued,  which,  after  reference  to  the  orders  issued  by 
France,  enjoined  that  no  vessel  should  be  allowed  to  trade  from 
one  enemy's  port  to  another ;  or  from  one  port  to  another  of  a 
French  ally's  coast  shut  against  English  vessels  ;  and  ordered  the 
commanders  of  the  ships  of  war  and  privateers  to  warn  every 
neutral  vessel  coming  from  any  such  port,  and  destined  to  another 
such  port,  to  discontinue  her  voyage,  and  that  any  vessel,  after 
being  so  warned,  which  should  be  found  proceeding  to  another 
such  port  should  be  captured  and  considered  as  lawful  prize. 
This  order  in  council  having  reached  Napoleon  at  Warsaw,  he 
immediately  ordered  the  confiscation  of  all  English  merchandise 
and  colonial  produce  found  in  the  Hanseatic  Towns.  Bourrienne, 
Napoleon's  commissioner  at  Hamburg,  declared  that  all  who  car- 
ried on  trade  with  England  supported  England  ;  that  it  was  to 
prevent  such  trading  that  France  took  possession  of  Hamburg ; 
that  all  English  goods  should  be  produced  by  the  Hamburghers 
for  the  purpose  of  being  confiscated ;  and  that  in  forty-eight 
hours  domiciliary  visits  would  be  paid  and  military  punishments 
inflicted  on  the  disobedient.  But  Britain  in  return  went  a  step 
further,  and  by  order  in  council,  Nov.  11,  1807,  declared  all  the 
ports  and  places  of  France,  and  those  of  her  allies,  and  of  all 
countries  where  the  English  flag  was  excluded,  even  though 
they  were  not  at  war  with  Britain,  placed  under  the  same  restric- 
tions for  commerce  and  navigation  as  if  they  were  blockaded,  and 
consequently  that  ships  destined  to  those  ports  should  be  liable  to 
the  visit  of  British  cruisers  at  a  British  station,  and  there  sub- 
jected to  a  tax  to  be  imposed  by  the  British  Parliament. 

Napoleon  was  at  Milan  when  this  order  in  council  was  issued, 
and  forthwith,  on  December  17,  the  famous  decree  appeared,  by 
which  he  imposed  on  neutrals  just  the  contrary  of  what  was  pre- 
scribed to  them  by  England,  and  further  declared  that  every 
vessel,  of  whatever  nation,  that  submitted  to  the  order  in  council 
of  November  n  should  by  that  very  act  become  denationalized, 
considered  as  British  property,  and  condemned  as  a  good  prize. 
The  decree  placed  the  British  islands  in  a  state  of  blockade, 
and  ordered  that  every  ship,  of  whatever  nation,  and  with  what- 
ever cargo,  proceeding  from  English  ports  or  English  colonies  to 


THE   ORDERS   IN   COUNCIL.  10$ 

countries  occupied  by  English  troops,  or  going  to  England,  should 
be  a  good  prize.  This  England  answered  by  the  order  in  coun- 
cil of  April  26,  1809,  which  revoked  the  order  of  1807  as  regards 
America,  but  confirmed  the  blockade  of  all  the  ports  of  France 
and  Holland,  their  colonies  and  dependencies.  And  then  France, 
still  further  incensed  against  England,  issued  the  tariff  of  Trianon, 
dated  Aug.  5,  1810,  completed  by  the  decree  of  St.  Cloud  of  Sep- 
tember 12,  and  of  Fontainebleau  of  October  19,  which  went  the 
length  of  ordering  the  seizure  and  burning  of  all  British  goods 
found  in  France,  Germany,  Holland,  Italy,  Spain,  and  in  every 
place  occupied  by  French  troops.  Strange  infatuation  !  and  how- 
many  States  took  part  in  this  mad  act  of  vindictiveness  !  The 
princes  of  the  Rhenish  Confederation  hastened  to  execute  it, 
some  for  the  purpose  of  enriching  themselves  by  the  wicked  deed, 
some  out  of  hatred  towards  the  English,  and  some  to  show  their 
devotion  towards  their  master.  From  Carlsruhe  to  Munich,  from 
Cassel  to  Dresden  and  Hamburg,  everywhere,  bonfires  were  made 
of  English  goods.  And  so  exacting  were  the  French,  that  when 
Frankfort  exhibited  the  least  hesitation  in  carrying  out  the  decree 
French  troops  were  sent  to  execute  the  order. 

By  means  such  as  these  the  commerce  of  the  world  was  greatly 
deranged,  if  not  destroyed  altogether,  and  none  suffered  more 
from  it  than  England  herself.  Was  it  not  enough  to  be  effectually 
shut  out  from  all  commerce  with  French  ports,  that  we  should 
have  provoked  the  closing  of  neutral  ports  also?  Was  it  politic, 
at  a  time  when  our  relations  with  the  principal  powers  were  in  a 
condition  so  critical,  to  alienate  from  us  all  the  neutral  states  of 
Europe?  Was  it  wise  to  inflict  so  grievous  an  injury  upon  neutral 
states,  as  to  force  them  to  make  common  cause  with  the  enemy? 
It  is  scarcely  possible  to  describe  at  what  peril  the  commerce  of 
the  world  was  carried  on.  The  proceedings  of  the  Court  of 
Admiralty  are  full  of  the  most  romantic  incidents.  An  American 
ship,1  with  a  cargo  of  tobacco,  was  sent  from  America  to  Vigo, 
or  to  a  market,  for  sale.  At  Vigo  the  tobacco  was  sold  under 
contract  to  deliver  it  at  Seville,  at  the  master's  risk,  and  the 
vessel  was  going  to  Seville  to  deliver  the  cargo  when  she  was 
captured.  A  British  vessel a  was  separated  from  her  convoy 
during  a  storm,  and  brought  out  by  a  French  lugger  which  came 
up,  and  told  the  master  to  stay  by  her  till  the  storm  moderated, 

iThe  "  Atlas,"  3  Rob.  Rep.,  p.  299. 

1  The  "  Edward  aud  Mary,"  3  Rob.  Rep.,  p.  305. 


IO6  SELECTIONS. 

when  they  would  send  a  boat  on  board.  The  lugger  continued 
alongside,  sometimes  ahead,  and  sometimes  astern,  and  some- 
times to  windward,  for  three  or  four  hours.  But  a  British  frigate 
coming  in  sight  gave  chase  to  the  lugger  and  captured  her,  during 
which  time  the  ship  made  her  escape,  rejoined  the  convoy,  and 
came  into  Poole.  Ships  were  taken  because  they  were  sailing  to 
false  destinations,  under  false  papers,  false  flags,  false  certificates 
of  ownership,  and  false  bills  of  sale.  They  were  seized  for 
running  the  blockade,  and  for  escaping  from  blockaded  ports. 
They  were  arrested  for  carrying  despatches,  military  men,  and 
contraband  of  war.  In  every  way,  at  every  point  of  the  ocean, 
the  pursuit  was  carried  on,  till  the  seas  were  cleared  of  merchant 
ships,  and  the  highway  of  nations,  the  widest  and  freest  arena  for 
trade,  was  converted  into  an  amphitheatre  for  the  display  of  the 
wildest  and  worst  excesses  of  human  cupidity  and  passions. 

But  a  greater  evil  than  even  this  extreme  derangement  of 
maritime  commerce  was  that  which  flowed  from  the  system  of 
licenses,1  an  evil  which  undermined  the  first  principles  of  com- 
mercial morality.  It  was  forcibly  stated  by  the  Marquis  of 
Lansdowne  that  the  commerce  of  the  country  was  one  mass 
of  simulation  and  dissimulation  ;  that  our  traders  crept  along  the 
shores  of  the  enemy  in  darkness  and  silence,  waiting  for  an  op- 
portunity of  carrying  into  effect  the  simulative  means  by  which 
they  sought  to  carry  on  their  business  ;  that  such  a  system  led  to 
private  violation  of  morality  and  honor  of  the  most  alarming 
description  ;  and  that,  instead  of  benefiting  our  commerce,  manu- 
factures, and  resources,  the  orders  in  council  diminished  our  com- 
merce, distressed  our  manufactures,  and  lessened  our  resources. 
Yet  all  these  warnings  and  expostulations  were  unheeded.  The 
national  mind  was  preoccupied  by  the  one  thought  of  compelling 
France  and  her  military  leader  to  a  complete  submission  ;  and 
no  consideration  of  a  commercial  or  pecuniary  character,  no  re- 
gard to  the  bearing  of  her  measures  upon  other  countries,  were 
sufficient  to  induce  a  reversal  of  this  military  and  naval  policy. 

Upwards  of  fifteen  years  had  elapsed  since  the  first  shot  was 
fired  between  England  and  France  after  the  great  revolution,  and 
yet  the  two  nations  were  as  intent  as  ever  on  securing  their  mu- 
tual destruction.  England  had  indeed  learnt,  by  this  time,  to 

1  The  number  of  commercial  licenses  granted  for  Imports  and  exports  was  68  in  1802,  836 
in  1803,  1,141  in  1804,791  in  1805,  1,620  in  1806,  2,606  in  1807, 4,910  in  1808, 15,236  in  1809,18,356 
in  iSiOt  and  7,602  in  iSji. 


THE   ORDERS   IN   COUNCIL.  IO/ 

make  light  of  all  such  decrees,  and  she  had  found  by  experience 
that  British  goods  found  their  way  to  the  Continent  in  spite  of  all 
vindictive  measures.  But  the  attitude  of  the  United  States  be- 
came more  and  more  threatening,  and  the  nations  saw  an  absolute 
necessity  for  revising  the  policy  of  the  orders  in  council.  For 
years  past  Lord  Temple,  Lord  Castlereagh,  Mr.  Perceval,  Sir 
John  Nichols,  had  brought  the  subject  before  the  House,  and 
many  a  long  discussion  had  taken  place  on  the  subject.  In  their 
opinion  this  country  had,  without  any  alleged  provocation  from 
the  United  States  of  America,  interrupted  nearly  the  whole  of 
their  commerce  with  Europe,  and  they  held  that  such  orders  in 
council  were  unjust  and  impolitic,  and  that  the  issuing  of  them, 
at  the  time  and  under  the  circumstances,  was  an  act  of  the  utmost 
improvidence  and  rashness.  Yet  the  nation  was  disposed  to  be 
guided  by  the  government ;  and  when  Lord  Grenville  moved 
resolutions  of  similar  import,  in  1809,  he  met  with  no  better 
response.  When,  however,  the  United  States,  after  having 
passed  the  Non-intercourse  Act,  proceeded  still  further  in  the 
way  of  preparation  for  open  hostilities,  the  merchants  began  to 
speak  their  mind  on  the  subject ;  and  from  London,  Hull,  Bristol, 
and  all  the  chief  ports,  petitions  came  to  the  legislature  praying 
for  the  revocation  of  the  obnoxious  orders.  The  merchants  of 
London  represented  that  trade  was  in  a  miserable  condition, 
chiefly  from  the  want  of  the  customary  intercourse  with  the 
continent  of  Europe  ;  that  employment  was  very  scarce,  and  the 
wages  of  labor  very  low  ;  that  the  aspect  of  affairs  threatened  ad- 
ditional suffering  to  those  then  experienced  ;  that  since  all  the  evils 
then  suffered  were  owing  to  the  continuance  of  the  war,  it  was 
all-important  to  obtain  if  possible  an  early  restoration  of  the  bless- 
ings of  peace  ;  that  it  was  not  from  any  dread  of  the  enemy  that 
they  made  such  a  request,  but  from  a  desire  that  no  opportunity 
might  be  lost  of  entering  into  negotiations  for  the  purpose  ;  that 
in  their  opinion  it  was  a  great  error  to  suppose  that  the  policy  of 
the  orders  of  the  council  could  in  anv  way  be  beneficial  to  trade  ; 
but  that,  on  the  contrary,  they  regarded  with  extreme  apprehen- 
sion its  effect  on  our  relations  with  the  United  States  of  America. 
The  merchants  of  Hull  complained  that  the  system  of  license 
sapped  public  morals.  Those  of  Bristol  represented  that  they 
suffered  intensely  in  their  general  trade  ;  and  riots  occurred  in 
Lancashire,  Yorkshire,  and  Cheshire. 

On  April  28,  1812,  the  House  of  Commons  agreed,  without  a 


108  SELECTIONS. 

division,  to  hear  evidence  in  support  of  these  petitions  ;  and,  on 
June  16,  Mr.,  afterwards  Lord,  Brougham  moved,  "That  an 
humble  address  be  presented  to  his  Royal  Highness  the  Prince 
Regent,  representing  to  his  Royal  Highness  that  this  House  has, 
for  some  time  past,  been  engaged  in  an  inquiry  into  the  present 
depressed  state  of  the  manufactures  and  commerce  of  the  country, 
and  the  effects  of  the  orders  in  council  issued  by  his  majesty  in 
the  years  1807  and  1809;  assuring  his  royal  highness  that  this 
House  will  at  all  times  support  his  royal  highness  to  the  utmost 
of  its  powers,  in  maintaining  those  just  maritime  rights  which 
have  essentially  contributed  to  the  prosperity  and  honor  of  the 
realm ;  but  beseeching  his  royal  highness  that  he  would  be 
graciously  pleased  to  recall  or  suspend  the  said  orders,  and  to 
adopt  such  measures  as  may  tend  to  conciliate  neutral  powers, 
without  sacrificing  the  right  and  dignity  of  his  majesty's  crown." 
In  the  most  graphic  manner  Lord  Brougham  depicted  the  distress 
of  the  country,  showed  how  erroneous  was  the  idea  that  what  we 
lost  in  the  European  trade  we  gained  in  any  other  quarter,  and 
warned  the  country  of  the  certainty  of  a  war  with  America  if  the 
orders  were  not  at  once  rescinded.  "  I  know,"  he  said,  "  I  shall 
be  asked,  whether  I  would  recommend  any  sacrifice  for  the  mere 
purpose  of  conciliating  America.  I  recommend  no  sacrifice  of 
honor  for  that  or  for  any  purpose  ;  but  I  will  tell  you  that  I  think 
we  can  well  and  safely,  for  our  honor,  afford  to  conciliate  America. 
Never  did  we  stand  so  high  since  we  were  a  nation  in  point  of 
military  character.  We  have  it  in  abundance,  and  even  to  spare. 
This  unhappy  and  seemingly  interminable  war,  lavish  as  it  has 
been  in  treasure,  still  more  profuse  of  blood  and  barren  of  real 
advantage,  has  at  least  been  equally  lavish  of  glory.  Its  feats 
have  not  merely  sustained  the  warlike  fame  of  the  nation,  which 
would  have  been  much  ;  they  have  done  what  seemed  scarcely 
possible,  —  they  have  greatly  exalted  it.  They  have  covered 
our  arms  with  immortal  renown.  Then,  I  say,  use  this  glory, 
—  use  this  proud  height  on  which  we  now  stand  for  the  pur- 
pose of  peace  and  conciliation  with  America.  Let  this  and 
its  incalculable  benefits  be  the  advantage  which  we  reap  from 
the  war  in  Europe,  for  the  fame  of  that  war  enables  us  safely 
to  take  it.  And  who,  I  demand,  give  the  most  disgraceful 
counsels,  —  they  who  tell  you  we  are  in  military  character  but  of 
yesterday,  we  yet  have  a  name  to  win,  we  stand  on  doubtful 
ground,  we  dare  not  do  as  we  list  for  fear  of  being  thought  afraid  ; 


THE   ORDERS    IN    COUNCIL.  109 

we  cannot,  without  loss  of  name,  stoop  to  pacify  our  American 
kinsmen?  or  I,  who  say  we  are  a  great,  a  proud,  a  warlike 
people  ;  we  have  fought  everywhere,  and  conquered  wherever  we 
have  fought ;  our  character  is  eternally  fixed  —  it  stands  too  firm 
to  be  shaken  ;  and,  on  the  faith  of  it,  we  may  do  towards  America 
safely  for  our  honor  that  which  we  know  our  interests  require? 
This  perpetual  jealousy  of  America  !  Good  God  !  I  cannot,  with 
temper,  ask  on  what  it  rests  !  It  drives  me  to  a  passion  to  think 
of  it !  Jealousy  of  America  !  I  should  as  soon  think  of  being 
jealous  of  the  tradesman  who  supplies  me  with  necessaries,  or 
the  client  who  entrusts  his  suits  to  my  patronage.  Jealousy  of 
America  !  whose  armies  are  as  yet  at  the  plough,  or  making, 
since  your  policy  has  willed  it,  so  awkward  (though  improving) 
attempts  at  the  loom  —  whose  assembled  navies  could  not  lay 
siege  to  an  English  harbor  !  Jealousy  of  a  power  which  is  neces- 
sarily peaceful  as  well  as  weak,  but  which,  if  it  had  all  the  ambi- 
tion of  France,  and  her  armies  to  back  it,  and  all  the  navy  of 
England  to  boot  —  nay,  had  it  the  lust  of  conquest  which  marks 
your  enemies,  and  your  own  army  as  well  as  navy,  to  gratify,  it 
is  placed  at  so  vast  a  distance  as  to  be  perfectly  harmless !  And 
this  is  the  nation  of  which,  for  our  honor's  sake,  we  are  desired 
to  cherish  a  perpetual  jealousy  for  the  ruin  of  our  best  interests. 
I  trust,  sir,  that  no  such  phantom  of  the  brain  will  scare  us  from 
the  path  of  our  duty.  The  advice  which  I  tender  is  not  the  same 
\vhich  has  at  all  times  been  offered  to  this  country.  There  is  one 
memorable  era  in  our  history  when  other  uses  were  made  of  our 
triumphs  from  those  which  I  recommend.  By  the  treaty  of 
Utrecht,  which  the  reprobation  of  ages  has  left  inadequately  cen- 
sured, we  were  content  to  obtain,  as  the  whole  price  of  Ramillies 
and  Blenheim,  an  additional  share  of  the  accursed  slave  trade.  I 
give  you  other  counsels.  I  should  have  you  employ  the  glory 
which  you  have  won  at  Talavera  and  Corunna  in  restoring  your 
commerce  to  its  lawful,  open,  honest  course,  and  rescue  it  from 
the  mean  and  hateful  channels  in  which  it  has  lately  been  con- 
fined. And,  if  any  thoughtless  boaster,  in  America  or  elsewhere, 
should  vaunt  that  you  have  yielded  through  fear,  I  would  not  bid 
him  wait  until  some  new  achievement  of  our  arms  put  him  to 
silence,  but  I  would  counsel  you  in  silence  to  disregard  him." 

The  effect  of  such  an  appeal  was  fatal  to  the  whole  system. 
The  government  saw  that  resistance  was  no  longer  possible,  and 
on  April  21  the  Prince  Regent  made  a  declaration  that  the  orders 


I  10  SELECTIONS. 

in  council  would  be  revoked  as  soon  as  the  Berlin  and  Milan 
decrees  should  be  repealed.  But  it  was  too  late.  America  had 
by  this  time  ceased  to  maintain  a  neutral  attitude.  And,  having 
made  a  secret  treaty  with  Napoleon,  she  issued  an  embargo  on 
all  British  vessels  in  American  ports,  declared  war  against  Eng- 
land, and  proceeded  to  make  an  ineffectual  attack  upon  Canada. 
The  political  condition  of  Europe,  however,  at  this  stage  happily 
assumed  a  bright  aspect.  The  long-desired  peace  began  to  dawn 
on  the  horizon,  and  in  rapid  succession  the  news  came  of  the 
battle  of  Leipzig,  the  entry  of  the  Allies  into  Paris,  and  the  abdi- 
cation of  Bonaparte.  Negotiations  then  commenced  in  earnest, 
and  they  issued  in  a  treaty  of  peace  and  Congress  of  Vienna, 
which  once  more  restored  order  and  symmetry  in  the  political  or- 
ganization of  Europe.1  On  Dec.  24,  1814,  a  treaty  of  peace  was 
signed  between  the  United  Kingdom  and  the  United  States.  On 
June  9,  1815,  the  principal  act  of  the  Congress  of  Vienna  was 
signed,  which  established  the  future  political  relations  of  the 
European  States,  and  laid  down  the  regulations  for  the  free  navi- 
gation of  rivers ;  and  on  July  27,  of  the  same  year,  a  Treaty  of 
Commerce  was  concluded  between  Great  Britain  and  the  United 
States  of  America. 

1  The  total  cost  of  the  war  with  France,  from  1793  to  1815  (the  war  expenditure  continued 
till  1817),  was  .£83 1, 446,449.  The  national  debt,  which,  in  1793,  amounted  to  ^247,874,434,  rose 
in  181510^861,039,049. 


FINANCES    OF   ENGLAND.  Ill 


VII. 

THE   FINANCES   OF   ENGLAND    1793-1815. 
FROM  PORTER'S  PROGRESS  OF  THE  NATION,  SECTION  IV. 


IN  order  to  give  an  intelligible  account  of  the  financial  state  of 
the.  kingdom  at  the  beginning  of  the  present  century,  it  is  neces- 
sary to  explain  briefly  the  system  which  had  been  brought  into 
operation  by  Mr.  Pittt  during  the  preceding  three  years. 

In  November,  1797,  that  minister  had  recourse  to  what  he  was 
pleased  to  call  "  a  perfectly  new  and  solid  system  of  finance." 
The  public  expenditure  of  that  year  amounted  to  twenty-five  and 
a  half  millions,  of  which  sum  only  six  and  a  half  millions  were 
provided  for  by  existing  unmortgaged  taxes,  leaving  nineteen 
millions  to  be  raised  by  extraordinary  means.  In  the  then  con- 
dition of  the  money  market,  it  was  felt  to  be  impossible  to  bor- 
row such  an  amount  in  the  ordinary  manner,  that  is,  providing 
by  new  taxes  for  the  payment  of  only  the  permanent  annual 
burthen  occasioned  by  the  increased  debt ;  and  a  new  impost,  cal- 
culated to  produce  seven  millions,  was  sanctioned  by  parliament, 
which  impost  was  to  be  continued  until  it  should,  in  conjunction 
with  the  produce  of  the  sinking-fund,  repay  the  twelve  millions 
that  would  be  still  deficient.  This  new  system  of  finance  might 
have  been  entitled  to  the  character  given  of  it  by  Mr.  Pitt,  if  it 
had  not  been  probable  —  nay,  certain  —  that  in  the  following 
years  an  equal  expenditure  must  be  met  by  similar  means,  until 
the  seven  millions  would  prove  inadequate  even  for  the  payment 
of  the  annual  interest  of  the  sums  for  which  the  tax  was  im- 
posed, when  it  would  become  part  of  the  permanent  burthens  of 
the  country.  This  new  impost,  to  which  the  name  of  "  triple 
assessment "  was  given,  was  in  fact  an  addition  made  to  the 
assessed  taxes,  "in  a  triplicate  proportion  to  their  previous 
amount  —  limited,  however,  to  the  tenth  of  each  person's'  in- 
come." 

The  adoption  of  this,  or  some  similar  plan  of  financial  arrange- 
ment, was  hardly  a  matter  of  choice  with  the  minister,  by  whom 


I  1 2  SELECTIONS. 

the  funding  system,  as  ordinarily  practised,  could  not  have  been 
any  further  pursued  at  that  time.  Unfortunately  for  the  success 
of  the  principle  which  it  was  thus  sought  to  establish,  the  mode 
in  which  it  was  proposed  to  raise  the  seven  millions  of  additional 
revenue  was  highly  unpopular,  and  indeed  it  has  always  excited, 
dissatisfaction  on  the  part  of  the  public  to  be  called  on  for  the 
payment  of  any  tax  from  which  they  have  not  the  power  to  pro- 
tect themselves,  by  abstaining  from  the  use  of  the  taxed  com- 
modity. It  is  this  consideration  which  has  always  made  our 
finance  ministers  prefer  indirect  to  direct  taxation,  and  which  led, 
during  the  progress  of  a  long  and  expensive  war,  to  the  imposi- 
tion of  duties  that  weighed  with  destructive  force  upon  the 
springs  of  industry.  The  financial  difficulties  by  which  the 
government  was  then  embarrassed  may  be  known  from  the  fact 
that  a  loan  of  three  millions  was  raised  in  April,  1798,  at  the  rate 
of  £200  three  per  cent,  stock,  and  55.  long  annuity  for  each  £100 
borrowed,  being  at  the  rate  of  six  and  a  quarter  per  cent.,  and  that 
the  "  triple  assessment,'"  which  was  calculated  to  produce  seven 
millions,  yielded  no  more  than  four  and  a  half  millions.  In  the  fol- 
lowing December  the  triple  assessment  was  repealed,  and  in  lieu 
of  it  an  income-tax  was  imposed  at  the  rate  of  10  per  cent,  upon 
all  incomes  amounting  to  £200  and  upwards,  with  diminishing 
rates  upon  smaller  incomes,  down  to  £60  per  annum,  below 
which  rate  the  tax  was  not  to  apply.  This  tax  was  estimated 
to  produce  ten  millions ;  it  was  called  a  war  tax ;  but,  when  the 
minister  proceeded  to  mortgage  its  produce  to  defray  the  interest 
of  loans  to  a  large  amount,  such  a  name  appeared  to  be  little 
better  than  a  delusion.  Like  the  triple  assessment,  the  produce 
of  the  income-tax  fell  greatly  short  of  its  estimated  amount, 
and  yielded  no  more  than  seven  millions,  a  large  part  of  which 
was  quickly  absorbed  to  defray  the  interest  of  loans  for  which  it 
was  successively  pledged.  In  1801,  after  deducting  the  sums 
thus  chargeable  on  it,  this  tax  produced  only  four  millions  towards 
the  national  expenditure.  In  proposing  a  loan  of  twenty-five  and 
a  half  millions  for  the  service  of  that  year,  it  was  considered  in- 
expedient to  mortgage  the  income  tax  any  further,  and  new  taxes 
were  imposed,  estimated  to  yield  .£1,800,000  per  annum.  In 
March,  1802,  peace  was  made  with  France,  and  in  the  same 
month  notice  was  given  by  the  Chancellor  of  the  Exchequer,  Mr. 
Addington,  of  his  intention  to  repeal  the  income-tax,  which  was 
felt  to  be  highly  oppressive,  and  had  become  more  and  more  odi- 


FINANCES    OF   ENGLAND.  113 

ous  to  the  people.  In  effecting  this  repeal,  and  at  the  same  time 
to  keep  faith  with  the  public  creditors,  to  whom  its  produce  had 
been  mortgaged  to  the  extent  of  fifty-six  and  a  half  millions  of 
3  per  cent,  stock,  additional  taxes  were  imposed  upon  beer, 
malt,  and  hops,  and  a  considerable  increase  was  made  to  the 
assessed  taxes,  besides  which  an  addition,  under  the  name  of  a 
modification,  was  made  to  the  tax  on  imports  and  exports,  pre- 
viously known  under  the  name  of  the  convoy  duty. 

At  this  time  the  aggregate  amount  of  permanent  taxes  was  thirty- 
eight  and  a  half  millions,  exactly  double  what  it  had  been  at  the 
breaking  out  of  the  war  in  1793.  During  those  nine  years,  taxes  to 
the  amount  of  £280,000,000,  exclusive  of  the  cost  of  collection, 
had  been  levied  from  the  people  ;  and  a  few  words  are  necessary 
in  order  to  account  for  the  seeming  contradiction  implied  in  the 
fact,  that,  notwithstanding  this  ruinous  rate  of  expenditure,  many 
of  the  great  interests  throughout  the  country  wore  the  outward 
appearance  of  prosperity.  A  nation  engaged  in  an  expensive 
war,  which  calls  for  the  systematic  expenditure  of  large  sums  be- 
yond its  income,  may  be  likened  to  an  individual  spendthrift 
during  his  career  of  riot  and  extravagance  ;  all  about  him  wears 
the  aspect  of  plenty  and  prosperity,  and  this  appearance  will  con- 
tinue until  his  means  begin  to  fail,  and  those  who  have  fattened 
upon  his  profusion  are  at  length  sent  away  empty.  The  enor- 
mous expenditure  of  the  government,  joined  to  the  state  of  the 
currency  (as  alreadv  explained),  necessarily  caused  a  general 
and  great  rise  of  prices ;  as  regarded  agricultural  produce,  this 
effect  was  exaggerated  by  the  ungenial  nature  of  the  seasons. 
Rents  had  risen  throughout  the  country  in  a  far  greater  de- 
gree than  the  necessary  expenditure  of  the  land-owners,  who 
thence  found  their  situations  improved,  notwithstanding  the 
additional  load  of  taxation.  The  great  number  of  contrac- 
tors and  other  persons  dealing  with  the  government  had 
derived  a  positive  benefit  from  the  public  expenditure,  and, 
being  chiefly  resident  at  the  seat  of  government,  they  were 
enabled  greatly  to  influence  the  tone  of  public  opinion.  The 
greater  command  of  money  thus  given  to  considerable  classes 
occasioned  an  increased  demand  for  luxuries  of  foreign  and 
domestic  production,  from  which  the  merchants  and  dealers 
derived  advantage.  There  were,  besides,  other  classes  of  persons 
who  profited  from  the  war  expenditure.  These  were  the  pro- 
ducers of  manufactured  goods,  and  those  who  dealt  in  them,  and 


114  SELECTIONS. 

who  found  their  dealings  greatly  increased  by  means  of  the  foreign 
expenditure  of  the  government  in  subsidies  and  expeditions,  the 
means  for  which  were  furnished  through  those  dealings ;  the 
manufacturers  were  at  the  same  time  beginning  to  reap  the  advan- 
tages that  have  since  been  experienced  in  a  more  considerable 
degree  from  the  sei'ies  of  inventions  begun  by  Hargreaves  and 
Arkwright,  and  which  acted  in  some  degree  as  palliatives  to  the 
evil  effects  of  the  government  profusion. 

As  in  the  case  of  the  spendthrift,  while  all  these  causes  were  in 
operation,  there  was  an  appearance  of  prosperity,  and  those  who 
were  profiting  from  this  state  of  things  were  anxious  to  keep  up 
the  delusion.  That  it  was  no  more  than  delusion  will  be  at  once 
apparent  to  all  who  examine  below  the  surface,  and  who  inquire 
as  to  the  condition  of  poverty  and  wretchedness  into  which  the 
great  mass  of  the  people  were  then  plunged.  In  some  few  cases 
there  had  been  an  advance  of  wages ;  but  this  occurred  only  to 
skilled  artisans,  and  even  with  them  the  rise  was  wholly  incom- 
mensurate with  the  increased  cost  of  all  the  necessaries  of  life. 
The  mere  laborer  —  he  who  had  nothing  to  bring  to  market  but 
his  limbs  and  sinews  —  did  not  participate  in  this  partial  compen- 
sation for  high  prices,  but  was,  in  most  cases,  an  eager  competitor 
for  employment,  at  the  same  or  nearly  the  same  wages  as  had  been 
given  before  the  war.  Nor  could  it  well  be  otherwise,  since  the 
demand  for  labor  can  only  increase  with  the  increase  of  the  capital 
destined  for  the  payment  of  wages  ;  and  we  have  seen  that  capital, 
so  far  from  being  suffered  to  accumulate,  was  dissipated  by  the 
government  expenditure  more  rapidly  than  it  could  be  accumulated 
by  individuals.  In  London  and  its  vicinity  the  rates  of  wages  are 
necessarily  higher,  because  of  the  greater  expense  of  living,  than 
in  country  districts ;  and  it  is  asserted,  from  personal  knowledge 
of  the  fact,  that  at  the  time  in  question  there  was  a  superabundant 
supply  of  laborers  constantly  competing  for  employment  at  the 
large  government  establishments,  where  the  weekly  wages  did  not 
exceed  153.,  while  the  price  of  the  quartern  loaf  was  is.  iod.,  and 
the  other  necessary  outgoings  of  a  laborer's  family  were  nearly 
as  high  in  proportion.  If  we  contrast  the  weekly  wages  at  the 
two  periods  of  1790  and  1800,  of  husbandry  laborers,  and  of 
skilled  artisans,  measuring  them  both  by  the  quantity  of  wheat 
which  they  could  command,  it  will  be  seen  that  the  former  could, 
in  1790,  purchase  eighty-two  pints  of  wheat,  and  in  1800  could 
procure  no  more  than  fifty-three  pints,  while  the  skilled  artisan, 


FINANCES    OF   ENGLAND.  115 

who  in  1790  could  buy  one  hundred  and  sixty-nine  pints,  could 
procure  in  1800  only  eighty-three  pints.  To  talk  of  the  prosper- 
ous state  of  the  country  under  such  a  condition  of  things  involves 
a  palpable  contradiction.  It  would  be  more  correct  to  liken  the 
situation  of  the  community  to  that  of  the  inhabitants  of  a  town 
subjected  to  a  general  conflagration,  in  which  some  became  sud- 
denly enriched  by  carrying  off'  the  valuables,  while  the  mass 
were  involved  in  ruin  and  destitution. 

It  may  be  objected  to  the  view  here  taken,  but  which  is  founded 
upon  facts  that  hardly  admit  of  controversy,  that,  had  the  con- 
dition of  the  country  been  such  as  is  represented,  we  must  have 
sunk  under  the  greater  efforts  we  wei'e  so  soon  after  called  on  to 
sustain  ;  and  there  is  every  reason  to  believe  that,  but  for  the  in- 
vention of  the  spinning-jenny,  and  the  improvements  in  the 
steam-engine,  which  have  produced  such  almost  magical  effects 
upon  the  productive  energies  of  this  kingdom,  it  would  have  been 
impossible  to  have  withstood  the  combination  with  which,  single- 
handed,  we  were  called  upon  to  contend.  The  manner  and  de- 
gree in  which  these  powerful  agents  have  enabled  us  to  with- 
stand and  to  triumph  over  difficulties  unparalleled  in  the  history 
of  the  world,  have  been  shown  in  a  preceding  section  of  this  in- 
quiry. 

CHAPTER  II. 

THE  public  expenditure  of  England  during  the  war  which 
was  begun  in  1793,  and  continued  (with  short  intermissions  in 
iSoi  and  1814)  until  the  final  overthrow  of  Napoleon  in  1815, 
was  conducted  throughout  upon  a  truly  gigantic  scale.  In  1792, 
the  last  year  of  peace,  the  entire  public  expenditure  of  the  king- 
dom was  £19,859,123,  which  sum  included  -£9,767,333  interest 
upon  the  public  debt.  In  1814  the  current  expenditure  amounted 
to  £76,780,895,  and  the  interest  upon  the  debt  to  £30,051,365, 
making  an  aggregate  sum  of  £106,832,260  paid  out  of  the  public 
exchequer  for  the  disbursements  of  that  one  year.  This  is  the 
largest  annual  outlay  ever  made  ;  that  of  the  previous  year  was 
within  one  million  of  the  same  amount. 

It  is  hardly  possible  to  conceive  that  the  public  expenditure  could 
have  been  long  continued  upon  this  scale  of  magnitude  ;  the  state 
of  exhaustion  under  which  the  country  was  made  to  suffer,  dur- 
ing the  first  few  years  of  the  peace  that  followed,  sufficiently  attests 
the  truth  of  this  opinion.  The  financial  efforts  of  the  government 


Il6  SELECTIONS. 

had  been  made  for  several  preceding  years  with  a  degree  of  lavish 
profusion  that  was  continually  augumented  until  it  reached  the 
height  above  mentioned  ;  the  expenditure,  including  interest  upon 
the  debt,  during  the  ten  years,  from  1806  to  1815,  inclusive,  aver- 
aged £84,067.761  per  annum,'  sums  which,  until  the  years  in 
which  they  were  actually  expended,  it  would  have  been  consid- 
ered wholly  chimerical  to  expect  to  raise.  The  experience  of  that 
period  has  shown  how  impossible  a  thing  it  is  to  judge  correctly 
from  the  past  as  to  the  growing  resources  of  our  country,  or  it 
might  be  confidently  affirmed  that,  during  the  concluding  years  of 
this  series,  we  had  assuredly  reached  the  limit  of  possibility. 
Without  that  experience  for  their  guidance,  our  ancestors,  in  for- 
mer but  not  very  remote  times,  gave  way  to  gloomy  forebodings  as 
to  their  future  prospects,  at  which  we  cannot  but  smile,  when 
thinking  of  the  comparatively  pigmy  efforts  which  called  them 
forth.  Some  of  those  forebodings  have  been  recorded  by  Sir 
John  Sinclair,  in  his  work  on  the  public  revenue  of  this  kingdom. 
A  few  passages  upon  the  subject,  taken  from  that  work,  and  with 
the  dates  at  which  they  were  written,  may  not  be  without  interest 
to  the  reader  at  the  present  moment. 

1736.  "  The  vast  load  of  debt  under  which  the  nation  still 
groans  is  the  true  source  of  all  those  calamities  and  gloomy  pros- 
pects of  which  we  have  so  much  reason  to  complain.  To  this 
has  been  owing  that  multiplicity  of  burthensome  taxes  which  have 
more  than  doubled  the  price  of  the  common  necessaries  of  life 
within  a  few  years  past,  and  thereby  distressed  the  poor  laborer 
and  manufacturer,  disabled  the  farmer  to  pay  his  rent,  and  put 
even  gentlemen  of  plentiful  estates  under  the  gi'eatest  difficulties 
to  make  a  tolerable  provision  for  their  families." —  The  Crafts- 
man, No.  502,  1 4th  Feburary,  1736. 

At  the  time  this  gloomy  picture  was  drawn  the  public  debt  did 
not  exceed  £50,000.000,  and  the  annual  charge  on  that  account 
was  somewhat  under  £2,000,000,  being  considerably  below  the 
sums  added  to  the  public  burthens  in  the  single  year  1814. 

1749.  "  Our  parliamentary  aids,  from  the  year  174°  exclusively, 
to  the  year  1748  inclusively,  amount  to  £55,522,159  i6s.  3d.,  a 
sum  that  will  appear  incredible  to  future  generations,  and  is  so 
almost  to  the  present.  Till  we  have  paid  a  good  part  of  our 
debt,  and  restored  our  country  in  some  measure  to  her  former 
wealth  and  power,  it  will  be  difficult  to  maintain  the  dignity  of 
Great  Britain,  to  make  her  respected  abroad,  and  secure  from  in- 


FINANCES   OF   ENGLAND.  1 1/ 

juries  or  even  affronts  on  the  part  of  her  neighbors."  —  Some 
Reflections  on  the  present  state  of  the  Nation,  by  Henry  St. 
John,  Lord  Bolingbroke. 

The  debt,  to  the  effects  of  which  so  much  evil  is  here  attributed, 
was  still  under  £80,000,000,  and  the  annual  interest  scarcely 
more  than  £3,000,000. 

1756.  "  It  has  been  a  generally  received  notion  among  politi- 
cal arithmeticians,  that  we  may  increase  our  debt  to  £100,000,- 
ooo,  but  they  acknowledge  that  it  must  then  cease,  by  the  debtor 
becoming  bankrupt."  —  Letters  by  Samuel  Hannay,  Esq. 

In  the  few  years  that  preceded  the  publication  of  Mr.  Hannay's 
letters  the  debt  had  been  somewhat  diminished,  so  that  it 
amounted  to  about  £75,000,000,  and  the  annual  charge  on  the 
country  to  £2,400,000. 

1761.  "The  first  instance  of  a  debt  contracted  upon  parlia- 
mentary security  occurs  in  the  reign  of  Henry  VI.  The  com- 
mencement of  this  pernicious  practice  deserves  to  be  noted,  —  a 
practice  the  more  likely  to  become  pernicious  the  more  a  nation 
advances  in  opulence  and  credit.  The  ruinous  effects  of  it  are 
now  become  apparent,  and  threaten  the  very  existence  of  the 
nation."  —  Hume's  History  of  England,  8vo  edition,  1778, 
vol.  iii,  p.  215. 

The  public  burthens  had  by  this  time  so  far  exceeded  the  pos- 
sible limit  assigned  by  Mr.  Hannay,  that  the  debt  amounted  to 
nearly  £150,000,000,  and  the  annual  interest  to  £4.800,000. 
The  amount  was  somewhat  reduced  between,  that  period  and  the 
breaking  out  of  the  American  war,  when  a  succession  of  loans 
again  became  necessary.  On  winding  up  the  accounts  of  that 
contest,  the  debt  amounted  to  £268,000,000,  and  the  annual 
charge  to  £9,500,000.  On  the  5th  of  January,  1793,  just  before 
the  beginning  of  the  war  of  the  French  Revolution,  the  debt  con- 
tinued nearly  the  same  as  at  the  beginning  of  the  peace  (the  exact 
amount  of  funded  and  unfunded  debt,  including  the  value  of  ter- 
minable annuities,  was  £261,735,059,  and  the  annual  charge  was 
£9,471,675).  From  that  time  to  the  peace  of  Amiens  hardly  a 
year  passed  without  witnessing  some  increase  to  the  national 
burthens,  so  that  at  midsummer  1802,  the  capital  of  the  funded 
and  unfunded  debt  amounted  to  £637,000,000.  On  the  5th  of  Jan- 
uary, 1816,  the  capital  was  £885,186,323,  and  the  annual  charge 
was  £32,457.141.  The  following  statements  exhibit  the  progres- 
sive state  of  the  public  income  and  expenditure  from  1792  to 


n8 


SELECTIONS. 


Abstract  of  Public  Income   and   Expenditure  lit   the   United   Kingdom 
In  each  year,  from  17O2  to   1M«». 


YEARS. 

INCOME. 

EXPENDITURE. 

Amount  of  Revenue  paid 
into  the  Exchequer,  the 
produce  of  taxation. 

Amount  received  on  ac- 
count of  Loans  and  Ex- 
chequer bills,  beyond 
the  amount  redeemed  in 
the  year. 

1 

T3 

1 
1 

11 

ji 

£19.253,8.4 
24,723,661 
37,191,463 

5o.348.3Si 

Interest  paid  on  public 
debt,  funded  and  un- 
funded. 

£ 

s%° 
||5  . 

Bill 
tt%» 

|£*1 
]JU 

Current  annual  public  ex- 
penditure. 

Total  amount  paid  and  ex- 
pended in  the  year. 

1792  
1793  
1794  .... 
>795  
1796  
1797  
1798  
1799  
1800  .... 
1801  
1802...   . 
1803  
'804  
1805  
1806  

1809  
1810  . 
iSn  
1812  
18.3  
1814  
1815  
:8i6..   .. 
1817  
1818  
1819  
1820  
1821  
1822  .... 
1823  
1824  

i::::: 

;&  

£.9,258,814 
i9.S4S.7°S 
20,193,074 
19,883,520 

4,877,956 
6,998,389 
30,464,831 

1;S:^ 
9,890,904 
10,810,728 
11,841,204 
14,270,616 
17.585,518 
17,320,983 
17.381,561 
19,945,624 
19,855,588 
20,699,864 
20,726,772 
32,141,426 
23,000,006 
23,362,685 

24,977  ,9  "5 
25,546,508 
28,030,239 
30,051,365 
31,576,074 
32,938,751 
31,436,245 
30,880,244 
30,807,249 
31,157,846 
31-955,304 
20,021,493 
29,215,905 
29,066,350 
28,060,287 
28,076,957 
28,239,847 
28,095,506 
29,155,612 
29,118,858 
28,341,416 
28,323,751 
28,522,507 
28,504,006 
28,514,610 
29,243,598 
29,489,571 
29,260,230 
29,454,063 
39,381,718 
29,450,145 
29,428,120 
29,269,160 
30,495,459 
38,253,872 
28,077,987 
38,141.53. 
28,563,517 
28,323.961 

,£2,421,681 

£  7,670,109 

14,759,208 
17,851,2.3 
37,603,449 
30,334,087 
36,469,993 
33,541,727 
38,403,421 
39,439,706 
41,383,555 
29,693,619 
28,298,366 
38,649,436 
45,027,892 
45,941,205 
44-250,357 
49,984,105 
52,352,146 
52,6.8,602 
58,757,308 
63,210,8.6 
77,913,488 
76,780,895 
60,704,106 
32,231,020 
22,0.8,170 
20,843,728 
21,436,130 

21,070,825 
20,826,567 
21,746,110 
23,708,252 
23-559-741 
25,808,585 
25,560,446 
21,407,670 
19,919-522 
18,024,085 
i8;78T,S82 
18,050,245 
16,235,735 
16,397,605 
15,884,649 
17-258,871 
17,641,383 
18,4.8,449 
19,903x629 
19,779,818 
30,735,584 
21,517,049 
21,870,353 
2o,it;2,iS9 
20,988,840 
22,865,843 
36,361,416 

2S,62I,6lQ 
22,529,66. 

£19,859,123 
24,197,070 
27,742,"7 
48,414,1/7 
42,175,291 
50,740,609 
51,127,245 
55,624,404 
56,821,267 
61,329,179 
49,549,207 
48,998,230 
59,376,208 
67,169,318 

67  ',61  3)043 
73,143,087 
76,566,013 
76,865,548 
83-735,223 
88,757-324 
105,943,727 
106,832,260 
92,280,180 
65,169,771 
55,281,238 
b3,34S,578 
55,406,509 
54,457,247 
57,130,586 
53,710,624 
56,223,740 
59,23i,i6i 
61  520,753 
55,081,073 
55,823,321 
54,17',  Hi 
51.835.137 
49,078,108 
49,797,156 
46,379,692 
45,782,026 
46,678  079 
45,669,309 
48.093,196 
49,116,839 
47,686,183 
49,357>69i 
49,169,553 
50,185,729 
50,945,169 
5'  -'48,254 
52,211,009 
59,386.603 
50.943.830 
54,502,947 
54-185,136 
50,874,696 



33,126,940 
3'.  03S.363 
35,602,444 
34,'4S,S84 
34,"3,i46 

38,609:392 
46,176,492 
50,897,706 
55,796-086 

59,339,321 
62,998,19! 
63,719,400 
67,144,542 
65,173,545 
65.037,850 
68,748,363 

7'.  134.503 
72,210,512 
62,264,546 
52,055,913 
53,747,795 
52,648,847 
54,382,958 
55,834,192 
55,663,650 
57-672,909 
59,362,403 
57-273,869 
54,894,989 
54-932,518 

30,356,873 
16,858,503 
21,714,863 
23,030,529 
27,305,271 
14,638,254 
8,753,761 
H,S7o,763 
16,849,801 
13,035,344 
10,432,934 
12,005,044 
12,298,379 
7,792,444 
'9,  i  43,  953 
34,790,697 
39,649,282 
34,563,603 
20,241,807 
5i4>059 

53,483.8i3 
47,893,866 
57,3i7>307 
57,i76>i  '3 
61,418,417 
51,006,403 
47.362,153 
60,747,255 
67,747,507 
7  1.  83  1,  43o 
69,772,255 
75,093,235 
76,017,779 
74,936,986 
84,317,498 
89,828,547 
108,397,645 
105,698,106 
92,452,319 
62,778,605 
52,o5S,9I3 
53,747.795 
52,648,847 
54,282,958 
55.834,192 
55,663,650 
57,672,999 
59,362,403 
57,273-869 
54,894,989 
54,932,5  "8 

£8$ 

50,056,616 
46,424,440 
47-322,744 
46,271  326 
46,425,263 
45,893.369 
48,591,180 
46,475,194 
47,333,460 
47-844,899 
47.567,565 
48,937,397 
48,580,026 
52,582,817 
54,003,754 
53,060,354 
53,790.138 
59,022,617 
54,982,662 
53-326,317 

'.'.'.'.'.'.'.'.'.' 



'.'.'.'.'.'.".'.'. 





1,826,814 
1,624,606 
3,163,130 
1,918,019 
4,104,457 
3,962,564 
5,261,725 
6,456,559 
9,900,725 
'.'95,53' 
2,023,028 
4,667,965 

2,760,00? 

igSS 

5,696 
1,023,784 
1,776,378 
1,270,050 
1,500,737 
1,985,885 

s'.oio1 





1829  
1830  
'831  
'832  
-833  
^34  
1835  
>s36  
is.??  
is?s  

1839  
1840  

:&::::: 
Sg::::: 
S3::::: 
Sit:::: 

1849..... 

grfM 
50,056,616 
46,424,440 

46,988.755 

46,271,326 
46,425,263 
45.803,360 
48,591,180 
46,475,194 
47.333,460 
47,844,809 
47.567,565 
48,084,360 

46,965,63. 

52,582,817 
54,003,754 
53,060,354 
53.790,138 
51,546,265 
53,388,717 
52.951,749 

333,989 

!.".'.."!! 

853,037 
1,614,395 

""8,74! 
1,563,361 
4,143,831 

?>476>3S3 
J,  593,945 
374,56S 

21  ,074 

FINANCES   OF   ENGLAND. 


119 


..-gj 

illi 


"  "^      ' "  °^  *°      " 


8s 


8 8 13  3  e  8  8  8  8  8  S  '•?  £>q  8  ~j ^  8  ?  ^  8  ?%  §  ! 
.-^i%&8  8.8^1'mi^ ||||  IHII^; 


BJ? 


IS 


120  SELECTIONS. 

1849,  including  the  annual  charge  on  account  of  the  public  debt, 
and  the  amount  of  money  raised  by  loans  and  the  funding  of  Ex- 
chequer Bills,  with  the  amount  and  description  of  stock  created, 
and  the  annual  charge  in  respect  of  the  same,  in  each  year  from 
the  beginning  of  the  present  century. 

An  extraordinary  degree  of  delusion  is  observable  in  the  pro- 
ceedings of  the  different  finance  ministers  by  whom  the  support 
of  the  sinking-fund  was  advocated  during  the  war.  It  has  been 
pretended  that  the  purchases  made  by  means  of  that  fund  had  the 
effect  of  keeping  up  the  market  value  of  the  public  debt,  and 
thereby  enabled  the  minister  to  contract  loans  upon  more  advan- 
tageous terms  than,  without  this  machinery,  would  have  been 
possible.  It  may  well  be  doubted,  however,  whether  the  repur- 
chase in  this  manner,  from  time  to  time,  of  parts  only  of  that 
surplus  portion  of  the  public  debt  which  was  created  for  the  ex- 
press purpose  of  such  operations,  had  any  real  effect  in  raising 
the  price  of  the  remaining  portion  of  the  public  securities ;  in 
other  words,  whether  the  price,  thus  factitiously  acted  upon,  of 
the  larger  amount  of  debt,  was  at  any  time  greater  than  the  price 
would  have  been  of  the  smaller  amount  of  debt  that  would  have 
existed  if  the  sinking-fund  had  not  been  created,  the  purchases 
of  the  commissioners  never  having  in  fact  accomplished  more 
than  the  repm-chase  of  the  so-needlessly-created  part  of  the  debt. 
It  has  been  further  urged  in  defence  of  the  sinking-fund,  that 
the  prospect  which  it  enabled  the  minister  to  hold  out  of  the 
speedv  redemption  of  the  whole  debt  had  the  effect  of  reconciling 
the  people  to  the  payment  of  a  larger  amount  of  taxes  than  they 
would  otherwise  have  been  willing  to  pay.  Allowing  that  the 
effect  here  stated  was  produced,  we  may  still  doubt  the  wisdom  of 
that  government  which  is  obliged  to  resort  to  a  juggle  in  order 
to  reconcile  the  people  to  its  measures,  and  especially  when,  as 
in  the  case  under  examination,  the  delusion  was  so  expensive 
and  likely  to  prove  so  permanently  injurious  in  its  nature. 

The  average  rate  at  which  3  per  cent,  stock  was  created 
between  1793  and  1801  was  £57  Js.  6d.  of  money  for  £100  stock, 
and  the  average  market  price  during  that  period  was  £61  ijs.  6d. 
for  £100  stock.  The  loss  to  the  public  upon  the  additional  sum 
borrowed  in  order  that  it  might  be  redeemed  during  that  period, 
which  was  £49,655,53!,  amounted  to  four  and  a  half  per  cent., 
or  £2,234,500.  Between  1803  and  the  termination  of  the  war, 
the  average  price  at  which  loans  were  contracted  was  £60  ^s.  6d. 


FINANCES    OF   ENGLAND.  121 

per  £100  stock,  and  the  average  market  price  during  that  time 
was  £62  ijs.  6d.  per  £100.  The  loss  was,  therefore,  two  and  a 
half  per  cent,  upon  the  sum  redeemed  during  that  time,  £176,- 
173,240,  or  £4,404,331,  making  together  an  amount  of  £6,638,- 
831  absolutely  lost  to  the  public  by  these  operations.  This 
amount,  reckoned  at  the  average  price  of  the  various  loans,  is 
equivalent  to  a  capital  of  more  than  eleven  millions  of  3  per 
cent,  stock,  with  which  the  country  is  now  additionally  burthened 
through  the  measure  of  borrowing  in  a  depressed  market  more 
money  than  was  wanted  in  order  to  its  being  repaid  when  the 
market  for  public  securities  was  certain  to  be  higher.  The 
fallacy  attending  this  system  is  now  so  fully  recognized  that  it  is 
not  likely  any  minister  will  in  future  make  a  show  of  redeeming 
debt  at  the  moment  when  circumstances  compel  him  actually  to 
increase  its  amount  for  that  purpose. 

Another  error  of  a  still  more  important  nature,  involved  in  this 
system,  remains  to  be  noticed.  The  absurdity  of  borrowing 
money  in  order  to  extinguish  debt  could  never  have  been  seriously 
adopted  but  with  the  anticipation  of  the  good  effects  that  might 
be  drawn  from  such  a  course  after  the  necessity  for  further  bor- 
rowing should  cease,  when  it  might  be  beneficial  to  apply  towards 
the  redemption  of  the  debt  the  high  scale  of  taxation  which  that 
system  rendered  practicable.  There  never  could  have  existed  any 
doubt  of  the  fact,  that  whenever  the  necessity  for  borrowing 
should  cease,  the  market  value  of  the  public  funds  would  advance 
greatly,  and  would  therefore  in  an  equal  degree  limit  the  redeem- 
ing power  of  the  surplus  income,  however  arising.  The  knowl- 
edge of  this  fact  should  have  led  the  ministers,  by  whom 
successive  additions  were  made  to  the  public  debt,  to  the  adop- 
tion of  a  course  which  would  have  enabled  them  to  turn  this  rise 
of  prices  to  the  advantage  of  the  public,  instead  of  its  being,  as 
it  has  proved,  productive  of  loss;  and  this  end  would  certainly 
have  been  accomplished,  if  at  the  expense  of  a  small  present 
sacrifice,  the  loans  had  been  contracted  at  a  high  rate  of  interest, 
instead  of  their  having  been  contracted,  as  for  the  most  part  they 
were,  in  3  per  cent,  annuities.  It  is  presumable  that,  if  the 
borrowing  had  been  restricted  to  the  sums  actually  wanted  from 
time  to  time,  without  thought  of  a  sinking-fund,  the  public 
might  possibly  have  had  to  pay  at  the  outside  a  quarter  per  cent, 
more  of  annual  interest  than  they  actually  paid.  At  this  rate  the 
deficiency  of  income  compared  with  expenditure,  between  1793 


122  SELECTIONS. 

and  1815,  which  amounted,  as  will  be  shown  in  the  next  Table, 
to  £425.482,761,  would  have  occasioned  an  addition  to  the  capi- 
tal of  the  debt  to  the  amount  of  £455,266,554  of  5  per  cent, 
stock,  the  annual  interest  of  which  would  have  been  £22,763,- 
327,  instead  of  a  nominal  capital  of  £547,292,764,  with  the 
annual  additional  charge  of  £20,690,871.  At  the  close  of  the 
war  the  nominal  capital  of  the  debt  would  have  then  amounted 
to  £724.285,729,  and  the  annual  charge  to  £32,530,660,  instead 
of  £816,311,939  of  capital,  and  £30,458,204  of  annual  charge, 
which  was  the  state  of  the  unredeemed  public  debt  on  the  5th  of 
January,  1816.  The  government  would  then  have  been  in  the 
most  favorable  position  for  taking  advantage  of  the  lowering  of  the 
rate  of  interest  which  was  certain  to  follow,  and  many  vears  before 
the  present  time  the  whole  of  the  5  per  cent,  annuities  might  have 
been  converted,  without  any  addition  to  the  capital,  into  annuities 
of  the  same  amount,  bearing  interest  at  the  rate  of  three  and  a 
half  per  cent.,  or  perhaps  lower.  Assuming,  however,  that  the 
reduction  would  not  have  gone  lower  than  three  and  a  half  per 
cent.,  and  taking  into  consideration  the  surplus  revenue  which 
has  been  actually  applied  to  the  redemption  of  debt  between  5th 
January,  1816,  and  5th  January,  1849,  which,  as  will  be  seen, 
amounted  to  £45,779,046,  the  funded  debt  existing  on  5th  of 
January,  1837,  would  have  amounted  to  £678,506,683,  and  the 
annual  charge  to  £23,747,734,  instead  of  its  actual  amount,  £773,- 
168,316,  and  its  actual  annual  charge,  £27,686,458  ;  showing  that 
the  loss  entailed  on  the  country  by  the  plan  pursued,  of  funding  the 
debt  in  stock  bearing  a  nominal  low  rate  of  interest,  is  £94,661,- 
633  of  capital,  and  £3,938,724  of  annual  charge.  It  is  not  pos- 
sible to  calculate  with  certainty  the  further  benefits  that  must  have 
resulted  from  the  repeal  of  five  millions  and  a  half  of  annual 
taxes,  which  would  have  been  practicable  beyond  the  amount 
actually  repealed  ;  but  it  is  probably  much  under-estimating  those 
benefits  to  state,  that  among  their  results  the  amount  of  public 
income  over  expenditure  would  have  been  so  far  augumented  that 
the  unredeemed  debt  would  not  at  this  time  have  exceeded  six 
hundred  millions,  while  the  annual  charge  upon  the  same  would 
have  been  twenty-one  millions,  a  state  of  things  at  which,  if  the 
peace  of  Europe  should  continue  undisturbed,  and  if  our  progress 
should  only  equal  our  past  experience,  we  may  possibly  hope  to 
arrive  in  about  half  a  century. 

The  charge  of  inconsistency  on  the  part  of  our  finance  ministers 


FINANCES    OF   ENGLAND.  123 

is  fully  deserved  by  their  adoption  of  two  measures  having  for 
their  objects  results  exactly  opposed  to  each  other.  These  meas- 
ures are,  first,  the  creation  of  what  is  called  the  dead-weight 
annuity  ;  and  secondly,  the  conversion  of  perpetual  annuities  into 
annuities  for  lives  or  for  terms  of  years  ;  the  effect  of  the  first  being 
to  bring  present  relief  at  the  expense  of  future  years,  while  the 
second  increases  the  present  burthen  with  the  view  of  relieving  pos- 
terity. When  the  measure  for  commuting  the  half-pay  and  pensions 
was  brought  forward  in  May,  1822,  the  charge  upon  the  country  on 
that  account  was  estimated  at  about  five  millions.  This  was 
necessarily  a  decreasing  charge,  and  from  year  to  year  the  public 
would  have  been  relieved  by  the  falling  in  of  lives,  until  at  the 
end  of  forty-five  years  the  whole,  according  to  probability,  would 
have  been  extinguished.  In  order  to  turn  to  present  advantage 
this  prospective  diminution  of  burthen,  it  was  attempted  to  com- 
mute the  whole  of  those  annually  diminishing  payments  into  an 
unvarying  annuity  to  last  during  the  whole  probable  term  of  forty- 
five  years,  and  it  was  computed  that,  by  the  sale  of  a  fixed  an- 
nuity of  £2.800,000,  funds  might  be  obtained  in  order  to  meet  the 
diminishing  demands  of  the  quarterly  claimants.  This  scheme  was 
only  partially  carried  into  execution  by  means  of  an  arrangement 
made  with  the  Bank  of  England,  under  which  that  corporation  ad- 
vanced to  the  government,  in  nearly  equal  payments,  during  the 
six  years  from  1823  to  1828,  the  sum  of  £13,089,419  as  the  pur- 
chase money  of  an  annual  annuity  of  £585,740  to  be  paid  until 
1867.  The  result  of  this  operation  has  been  to  save  the  imme- 
diate payment  during  the  years  in  which  it  was  in  progress  of 
£9,574,979,  and  in  return  to  fix  upon  the  country  the  annual  pay- 
ment for  thirty-nine  years  thereafter  of  £585,740. 

In  the  prosecution  of  the  opposite  plan  of  converting  perpetual 
annuities  into  annuities  terminable  at  stated  periods,  or  upon  the 
occurrence  of  certain  natural  contingencies,  the  amount  of  termi- 
nable annuities  has  advanced  from  £1.888,835,  at.  which  it  stood  at 
the  end  of  the  war,  to  £3,755 '°99  a'  tne  beginning  of  the  year 
1850.  It  would  occupy  considerable  space  to  exhibit  the  progress 
of  this  conversion  from  year  to  year,  and  it  will  probably  suffice 
to  exemplify  the  result  of  the  operation  during  one  year  (1834). 
In  that  year  the  perpetual  annuities  received  in  exchange  amounted 
to  £6,500,169  of  capital,  bearing  an  annual  charge  of  £202,831, 
and  there  were  granted,  in  lieu  of  the  same  — 


124  SELECTIONS. 

Annuities  for  lives          ....     £195,337 

"         for  terms  of  years  .         .         .        313*138 

Deferred  annuities          .         .         .         .  2,871 

Together         .         .     £511,346 

making  a  present  annual  increase  of  £308,514  to  the  public  bur- 
thens in  order  to  ensure  the  earlier  extinction  of  the  charge  of 
£202,831. 

It  is  not  necessary  here  to  inquire  which  of  these  two  modes  of 
proceeding  is  preferable.  Under  different  circumstances  either 
of  them  might  be  wise  or  prudent,  but  it  is  quite  impossible  that 
at  the  same  time,  and  consequently  under  the  same  circumstances, 
both  could  be  either  wise  or  prudent,  and  the  minister  and  legis- 
lators by  whom  the  plans  were  proposed  and  sanctioned  must  be 
allowed  to  have  stultified  themselves  by  the  operations.  Of  the 
two  courses  that  is  assuredly  the  most  generous,  which  subjects 
the  parties  by  whom  it  is  adopted  to  additional  burthen  in  order 
to  lighten  the  load  for  their  successors,  and  indeed  it  would  seem 
no  more  than  an  act  of  justice  on  the  part  of  those  by  whom  the 
debt  was  contracted  to  adopt  every  means  within  their  power  for 
its  extinction. 

It  is  singular  that,  with  so  much  experience  and  so  much  of 
scientific  acquirement  that  could  have  been  brought  to  the  correct 
elucidation  of  this  subject,  the  tables  adopted  for  the  creation  of 
terminable  annuities  were  incorrect,  to  a  degree  which  entailed  a 
heavy  loss  upon  the  public.  The  system  was  established  in  1808, 
and  during  the  first  year  of  its  operation  annuities  were  granted 
to  the  amount  of  £58,506  los.  per  annum.  Of  that  amount  thei'e 
continued  payable  £23,251  per  annum  at  the  beginning  of  1827, 
when,  to  adopt  the  calculation  of  the  actuary  of  the  national  debt, 
as  given  in  a  report  to  the  Chancellor  of  the  Exchequer,  the 
public  had  already  sustained  a  loss  of  more  than  £10,000  by  the 
transactions,  besides  having  the  above  annual  sum  of  £23,251 
still  to  pay  for  an  indefinite  term.  In  this  report  of  Mr.  Finlaison 
he  states  that  the  loss  to  the  public  through  miscalculation  in 
these  tables  was  then  (April,  1827)  proceeding  at  the  rate  of 
£8,000  per  week,  and  during  the  three  preceding  months  had  ex- 
ceeded £95,000,  The  discovery  of  this  blunder  had  been  made 
and  pressed  upon  the  attention  of  the  finance  minister  as  early  as 
1819,  but  no  active  steps  were  taken  to  remedy  it  until  1828,  and 


FINANCES   OF   ENGLAND.  125 

even  then  the  rates  at  which  annuities  were  granted  upon  the 
lives  of  aged  persons  were,  after  a  time,  found  to  be  so  unduly 
profitable  to  the  purchasers,  that  the  government  was  again 
obliged  to  interfere  and  to  limit  the  ages  upon  which  life  annuities 
could  be  obtained. 

It  is  quite  impossible  that  any  similar  series  of  blunders  could 
have  been  committed  by  any  private  persons  or  association  of 
individuals,  whose  vigilance  would  have  been  sufficiently  pre- 
served by  their  private  interest ;  and  it  is  disgraceful  that  the 
government,  which  could  at  all  times  command  the  assistance  of 
the  most  accomplished  actuaries,  should  have  fallen  into  them.  It 
is  yet  more  disgraceful  that,  after  the  evil  had  been  discovered  and 
pressed  upon  its  notice,  so  many  years  were  suffered  to  elapse  before 
any  step  was  taken  to  put  a  stop  to  the  waste  of  public  money. 

It  would  require  a  voluminous  account  to  explain  all  the  finan- 
cial operations  of  the  government  during  the  period  embraced  in 
the  foregoing  statements.  In  the  earlier  years  of  that  time,  while 
on  the  one  hand  the  minister  was  annually  borrowing  immense  sums 
for  the  public  service,  an  expensive  machinery  was,  as  we  have 
seen,  employed  to  keep  up  a  show  of  diminishing  the  debt,  and 
by  this  means  the  people  were  brought  to  viewr  with  some  degree 
of  complacency  the  most  ruinous  addition  to  their  burthens,  under 
the  expectation  of  the  relief  which,  through  the  magical  effect  of 
the  sinking  fund,  was  to  be  experienced  by  them  in  future  years. 
The  establishment  and  support  of  this  sinking-fund  was  long  con- 
sidered as  a  master-stroke  of  human  wisdom.  Having  since  had 
sufficient  opportunity  for  considering  its  effects,  we  have  arrived 
at  a  different  conclusion,  and  can  no  longer  see  any  wisdom  in  the 
plan  of  borrowing  larger  sums  than  were  wanted,  and  paying  in 
consequence  more  dearly  for  the  loan  of  what  was  actually 
required,  in  order  to  lay  out  the  surplus  to  accumulate  into  a  fund 
for  buying  up  the  debt  at  a  higher  price  than  that  at  which  it  was 
contracted. 

In  the  fourth  report  of  the  Select  Committee  on  Public  Income 
and  Expenditure,  which  was  printed  by  order  of  the  House  of 
Commons,  in  1828,  there  are  three  statements  showing  the  differ- 
ence between  the  public  receipts  and  disbursements  in  the  ten 
years  ended  5th  January,  1802  ;  the  fourteen  years  ended  5th 
January,  1816  ;  and  the  twelve  years  ended  5th  January,  1828  ;  an 
abstract  of  which  is  here  given,  and  the  statement  is  further  con- 
tinued for  the  twenty-two  years  ended  5th  January,  1850:  — 


126 


SELECTIONS. 


Expenditure 
Income 


£447,812,773 
258,659,322 


BALANCE   OF  INCOME  AND    EXPENDITURE. 

Ten  Years  ended  ^th  January,  1802. 

Raised  by  creation  of 

debt 

Applied  to  redemption 

of  debt      ....  £180,346,440 
Money  raised  for 

Austria      ....          4,600,000 
Discount  and  charges 

of  receipt       .     .     . 


Expenditure 
more  than 
income  . 


£189,153,451 


Balance    5th  January, 

1802 £9,027,021 

Balance  5th   January, 

1792 


2,416,497 

187,362,937 

£193,634,443 


4,546,029 

4,480,992 


£189,153,451 


Expenditure  £1,059,683,370 
Income     .     .      823,354,060 


fourteen  Years  ended  ^th  January,  1816, 


Expenditure 
more  than 


Raised  by  creation  of 

debt 
Applied  to  redemption 

of  debt     .... 
Raised   for  East  India 

Company  .... 
Discount,  etc.  . 


Balance  5th   January, 
1816 

Balance  5th   January, 
1802     .     . 


900,107,717 


£651,952,651 

2,500,000 
2,887,199 


£242,767,867 


£15.465,578 


6,438,557 


236,329,310 

Twelve  Years  ended ^th  January,  1828. 


Income      .     .      670,198,286 
Expenditure  .     640,966,521 

Applied  to  redemption 
of  debt     .... 
Discount  and  charges 
of  receipt      .     .     . 

580,454,422 
544.588 

Raised  by  creation  of 
debt     

£580,999,040 
540,530,450 

Balance  5th   January, 
1816     
Balance  5th   January, 
1828 

£40.468,590 
£15,465,578 

4,228,753 

than  expen- 

diture   .     .     £29,231,765 

£29,231,765 

FINANCES    OF   ENGLAND.  127 


Twenty-two  Years  ended  ^th  January,  1850. 


Income.     .   £1,092,219,672 
Expenditure       1,075,645,391 


Income  more 
than  expen- 
diture .  .  £16,574,281 


Applied  to  redemption 
of  debt,  beyond  the 
amount  of  debt  cre- 
ated    £11,054,495 

Balance   5th   January 

1850 £9,748,539 

Balance  5th  January, 

1828 4,228,753 

5,519,786 


£16,574,281 


It  appears  from  this  statement  that  during  the  ten  years  from 
5th  Jan.,  1792  to  5th  Jan.,  1802  — 

The  public  expenditure  exceeded  the  income     £189,153,451 
Between  1802  and  1816  the  excess  of  expen- 
diture was  .         *         .         ...        236,329,310 


Excess  of  expenditure  during  twenty-four 

years  of  war  ......  £425,482,761 

During  thirty-four  years  of  peace,  between 
1816  and  1850,  the  excess  of  income  over 
expenditure  has  been  .  .  .  .  45,7795046 

At  this  rate  it  would  require  three  hundred  and  sixteen  years 
of  peace  to  cancel  the  debt  incurred  during  twenty-four  years  of 
war,  or  thirteen  years  for  one  ;  but  the  comparison  is  even  more 
unfavorable  than  this,  because  at  the  time  of  borrowing  the  rate 
of  interest  is  high  and  the  value  of  public  securities  low,  whereas 
at  the  time  of  liquidation  the  reverse  of  these  circumstances  is  ex- 
perienced, so  that  on  the  most  favorable  supposition  it  requires 
fifteen  years  of  saving  in  peace  to  repair  the  evil  consequences  of 
one  vear  of  war  expenditure  ;  at  which  rate,  our  successors  who 
may  be  living  about  the  close  of  the  twenty-second  century  will 
find  themselves  relieved  from  that  portion  of  the  public  debt  which 
has  been  contracted  since  1792.  On  the  other  hand,  this  period 
would  be  somewhat  hastened  through  the  extinction  of  that  part 
of  public  debt  which  consists  of  terminable  and  life  annuities. 

It  is  necessary  here  to  explain  briefly  the  financial  plans  which 
have  at  different  times  within  the  present  century  been  proposed 
by  the  Government  and  sanctioned  by  Parliament. 

At  the  breaking  out  of  the  war  in  1803,  it  became  necessary  to 
meet  as  far  as  possible  the  increased  expenditure  of  the  country  by 


128  SELECTIONS. 

the  imposition  of  new  taxes,  among  which  was  included  the  in- 
come-tax, under  the  name  of  a  property-tax.  The  greater  part  of 
these  taxes  were  declared  to  be  of  a  temporary  character,  and  were 
to  cease  in  six  months  after  the  reestablishment  of  peace.  It  soon 
became  apparent,  however,  that  to  adhere  to  this  stipulation 
would  be  impossible,  since  the  exigencies  of  the  country  required 
the  contraction  of  loans,  the  interest  of  which  could  not  be  pro- 
vided, except  by  the  gradual  appropriation  of  one  portion  after 
another  of  the  proceeds  of  the  war  taxes.  Under  these  circum- 
stances, it  was  proposed,  in  1807,  by  Lord  Henry  Petty,  then 
Chancellor  of  the  Exchequer,  to  depart  from  the  usual  practice 
of  confining  the  financial  arrangements  to  the  current  year,  and 
to  determine  at  once,  as  far  as  was  possible,  the  amount  which 
it  would  be  necessary  to  raise  during  each  one  of  a  series  of  years, 
providing  beforehand  the  means  for  meeting  the  increasing  bur- 
then. It  was  assumed  that  the  loans  to  be  raised  in  1807  and 
the  two  following  years  should  be  each  £12,000,000;  that  for 
1810  was  stated  at  £14,000,000,  and  during  each  of  the  ten  en- 
suing years  the  amount  was  assumed  at  £16,000,000.  It  was 
calculated  that  the  interest  upon  those  loans  would  be  met,  up  to 
that  for  the  year  1811,  by  the  falling  in  of  annuities,  after  which, 
the  war  taxes  were  to  be  pledged,  at  the  rate  of  ten  per  cent., 
upon  each  loan  :  five  per  cent,  to  pay  the  interest,  and  five  per 
cent,  to  accumulate  as  a  sinking-fund  for  discharging  the  principal. 
The  deficiency  that  would  be  occasioned  by  this  appropriation 
year  by  year  of  the  war  taxes  was  to  be  met  by  supplementary 
loans  for  the  interest  on  which,  and  to  provide  a  sinking-fund  for 
their  redemption,  it  would  be  necessary  to  impose  new  taxes. 
By  these  means  it  was  expected  that  the  country  would  have  been 
able  to  meet  the  charges  of  an  expensive  war  during  a  series  of 
years  with  only  a  moderate  addition  to  the  public  burthens.  The 
ministry,  of  which  Lord  Henry  Petty  formed  a  part,  having  gone 
out  of  office  before  the  next  annual  finance  arrangement  was 
brought  forward,  his  plan  was  abandoned,  and  no  attempt  has 
since  been  made  by  any  minister  to  form  financial  arrangements 
embracing  the  circumstances  of  future  years. 

The  explanations  offered  each  year  in  the  House  of  Commons 
by  the  Chancellor  of  the  Exchequer,  concerning  the  financial 
condition  of  the  country,  are  not  given  in  such  a  form  as  to  be 
readily  understood.  In  the  accounts  by  which  the  statements  are 
accompanied,  the  interest  of  the  debt  and  other  permanent  charges 


FINANCES    OF   ENGLAND.  1 29 

are  not  included,  and  on  the  other  hand  nothing  is  stated  regard- 
ing the  produce  of  the  permanent  taxes,  forming  what  is  called 
the  consolidated  fund,  except  the  amount  of  its  surplus  or  defi- 
ciency, as  the  case  may  be,  after  pi'oviding  for  the  permanent 
charge  upon  it.  The  Budget,  as  it  is  the  practice  to  call  this 
annual  exposition,  explains  on  the  one  hand  the  sums  required  for 
the  public  service  during  the  year,  under  the  different  heads  of 
Navy,  Army,  Ordnance,  and  Miscellaneous  Services,  together 
with  any  incidental  charges  which  may  apply  to  the  year ;  and  on 
the  other  hand,  are  given  the  ways  and  means  for  meeting  the 
same.  These  ways  and  means  consist  of  the  surplus  (if  any)  of 
the  consolidated  fund,  the  annual  duties,  and  such  incidental 
receipts  as  come  in  aid  of  the  national  resources. 

The  detail  of  these  budgets  would  consequently  throw  but  little 
light  upon  the  financial  condition  of  the  country,  if  even  they  had 
been  preserved  in  an  authentic  form,  which  has  not  been  done. 
Any  statements  of  the  kind  that  could  be  offered  must  be  drawn 
from  unauthorized  publications,  in  which  they  have  been  given 
without  regard  to  methodical  arrangement,  while, as  respects  some 
years  of  the  series,  we  should  seek  in  vain  for  any  statement  what- 
ever. 


I3O  SELECTIONS. 


VIII. 
THE    ZOLLVEREIN. 

FROM    BOWRING'S    REPORT    ON    THE    PRUSSIAN    COMMERCIAL   UNION, 
PARL.  Doc.  1840,  VOL.  XXI.,  PP.  1-17. 

IN  compliance  with  the  instructions  which  I  had  the  honor  to 
receive  from  your  lordship,  dated  Foreign  Office,  July  14,  1839, 
I  proceed  to  report  on  the  progress,  present  state,  and  future 
prospects  of  the  Prussian  Commercial  League. 

No  doubt  this  great  Union,  which  is  known  in  Germany  by 
the  name  of  the  Zoll  Verein  or  Zoll  Verbande  (Toll  Associa- 
tion or  Alliance),  derived  its  first  and  strongest  influence  from  a 
desire  to  get  rid  of  those  barriers  to  intercommunication  which 
the  separate  fiscal  legislation  of  the  various  States  of  Germany 
raised  among  a  people  whom  natural  and  national  feelings,  as 
well  as  common  interests,  would  otherwise  have  connected  more 
intimately  and  permanently  together. 

The  Zoll  Verein  represents,  in  Germany,  the  operation  of  the 
same  opinions  and  tendencies  which  have  already  effected  so 
many  changes  in  the  commercial  legislation  of  other  countries. 
In  the  United  Kingdom  the  custom-house  laws  which  separated 
Scotland  and  Ireland  from  England,  have  been  superseded  by  a 
general  system  applicable  to  the  whole.  In  France  the  local  bar- 
riers and  the  local  tariffs  have  given  way  to  a  general  and  uniform 
system  of  taxation.  Even  before  the  Commercial  League  associ- 
ated so  many  States  in  a  common  union,  several  less  extensive  com- 
binations had  prepared  the  way  for  a  more  diffusive  intercourse. 
Between  the  States  which  do  not  form  part  of  the  Prussian 
League  —  as,  for  example,  between  Hanover  and  Brunswick  and 
Oldenburgh  the  same  tariffs  have  been  adopted,  and  the  payment 
of  duties  in  one  of  the  States  is  sufficient  to  secure  free  sale  or 
transit  in  the  other. 

The  Commercial  League  is,  in  fact,  the  substantial  representa- 
tive of  a  sentiment  widely,  if  not  universally,  spread  in  Germany 
—  that  of  national  unity.  It  has  done  wonders  in  breaking  down 


THE   ZOLLVEREIN.  131 

petty  and  local  prejudices,  and  has  become  a  foundation  on  which 
future  legislation,  representing  the  common  interests  of  the  Ger- 
man people,  may  undoubtedly  be  hereafter  raised.  If  well 
directed  in  its  future  operation,  the  Zoll  Verein  will  represent 
the  fusion  of  German  interests  in  one  great  alliance.  The  peril 
to  its  beneficial  results  will  grow  out  of  the  efforts  which  will  be 
made,  and  which  are  already  made,  to  give  by  protections  and 
prohibitions  an  undue  weight  to  the  smaller  and  sinister  interests 
of  the  Verein.  But  if  its  tariffs  be  so  moderate  and  so  judicious 
as  to  allow  full  play  to  the  interests  of  the  consumers  in  the  field 
of  competition  —  if  there  should  be  no  forcing  of  capital  into 
regions  of  unproductiveness  or  of  less  productiveness  —  if  the 
claims  of  manufacturers  to  sacrifices  in  their  favor  from  the  com- 
munity at  large  be  rejected  —  if  the  great  agricultural  interests  of 
Germany  recover  that  portion  of  attention  from  the  commercial 
union  to  which  they  are  justly  entitled  —  if  the  importance  of 
foreign  trade  and  navigation  be  duly  estimated  —  the  Zoll  Verein 
will  have  the  happiest  influence  on  the  general  prosperity.  And 
that  the  League  has  been  much  strengthened  by  the  experience 
of  its  benefits  —  that  its  popularity  is  extending — that  its  further 
spreading  may  be  confidently  anticipated  —  appears  to  be  indubi- 
table. In  fact,  the  Zoll  Verein  has  brought  the  sentiment  of 
German  nationality  out  of  the  regions  of  hope  and  fancy  into 
those  of  positive  and  material  interests ;  and  representing,  as  it 
does,  the  popular  feeling  of  Germany,  it  may  become,  under  en- 
lightened guidance,  an  instrument  not  only  for  promoting  the 
peace  and  prosperity  of  the  States  that  compose  it,  but  of  extend- 
ing their  friendly  relations  through  the  world. 

Considerations  both  of  morality  and  economy  were  not  want- 
ing to  recommend  the  Commercial  Union  to  the  German  people. 
Not  only  were  the  numerous  barriers  and  various  legislation  of 
the  German  States  great  impediments  to  trade,  but  they  created 
a  considerable  amount  of  contraband  traffic,  and  caused  the  coun- 
try to  swarm  with  petty  smugglers,  who  lived  upon  the  profits 
which  the  varieties  of  the  tariffs  placed  within  their  reach.  The 
custom-house  administration  was  costly,  and  generally  inefficient, 
from  the  extent  of  frontier  to  be  guarded  ;  so  that  the  estab- 
lishment of  one  large  instead  of  a  variety  of  small  circles  has  led 
at  the  same  time  to  a  great  diminution  of  cost  and  a  great  increase 
of  efficiency,  while  it  has  removed  from  all  the  interior  of 
Germany  that  demoralizing  influence  which  the  presence  of 


132  SELECTIONS. 

multitudes  of  illicit  traders  and  smugglers  always  brings  with 
it. 

'The  Zoll  Verein  was  not,  as  it  has  been  often  asserted  to  be,  a 
union  formed  in  hostility  to  the  commercial  interests  of  other 
States  —  it  was  not  intended  prematurely  to  create  a  manufactur- 
ing population  in  rivalry  with  or  opposition  to  the  manufacturing 
aptitudes  of  Great  Britain —  it  was  by  no  means  the  purpose  of  its 
founders  to  misdirect  capital  to  unprofitable  employment,  to  sacri- 
fice agriculture  to  trade,  or  to  encourage  less  the  field  than  the  fac- 
tory. The  Zoll  Verein  was  the  substantial  expression  and  effect  of 
a  general  desire  among  a  great  nation,  split  into  many  small  States, 
but  still  of  common  origin,  similar  manners,  speaking  the  same 
language,  educated  in  the  same  spirit,  to  communicate,  to  trade,  to 
travel,  without  the  annoyance  and  impediments  which  the  sepa- 
rate fiscal  regulations  of  every  one  of  their  governments  threw  in 
the  way.  If,  in  the  natural  process  of  things,  the  tariffs  of  the 
Zoll  Verein  have  become  hostile  to  the  importation  of  foreign, 
and  especially  of  British,  produce,  it  is  because  our  laws  have 
prevented  the  greater  extension  of  commercial  relations  with  Ger- 
many. We  have  rejected  the  payments  they  have  offered  —  we 
have  forced  them  to  manufacture  what  they  were  unable  to  buy  — 
and  we  have  put  in  their  hands  the  means  of  manufacturing 
cheaply,  by  refusing  to  take  the  surplus  of  their  agricultural  pro- 
duce, the  non-exportation  of  which  has  kept  their  markets  so  low 
that  small  wages  have  been  sufficient  to  give  great  comforts  to 
their  laborers. 

There  can  be  no  doubt  that  the  hostile  tariffs  of  other  nations, 
and  especially  the  corn  and  timber  laws  of  Great  Britain,  served 
greatly  to  strengthen  the  arguments  in  favor  of  Commercial 
Union.  It  was  felt  necessary  to  extend  the  home  market  while 
foreign  markets  were  closed,  or  only  partially  and  irregularly 
opened,  to  the  leading  articles  of  German  production. 

u  We  should  not  have  complained,"  says  a  distinguished  Ger- 
man writer,  in  1835,  "  that  all  our  markets  were  overflowing 
with  English  manufactures  —  that  Germany  received  in  British 
cotton  goods  alone  more  than  the  hundred  millions  of  British  sub- 
jects in  the  East  Indies —  had  not  England,  while  she  was  inun- 
dating us  with  her  productions,  insisted  on  closing  her  markets 
to  ours.  Mr.  Robinson's  Resolutions  in  1815  had,  in  fact,  ex- 
cluded our  corn  from  the  ports  of  Great  Britain  ;  she  told  us  we 
were  to  buy,  but  not  to  sell.  We  were  not  willing  to  adopt  re- 


THE   ZOLLVEREIN.  133 

prisals  ;  we  vainly  hoped  that  a  sense  of  her  own  interest  would 
lead  to  reciprocity.  But  we  were  disappointed,  and  we  were 
compelled  to  take  care  of  ourselves  "! 

Thus,  while  on  the  one  hand,  the  Zoll  Verein  was  advocated 
as  a  measure  of  self-defence  against  the  hostile  legislation  of 
foreign  nations,  it  should  not  be  forgotten  that,  as  respects  the 
confederated  States,  it  represented  the  principles  of  unrestricted 
intercommunication. 

As  between  more  that  twenty-six  millions  of  Germans,  it  was 
the  establishment  of  free  trade;  restrictions,  duties,  prohibitions, 
custom-houses,  there  are  none,  as  far  as  regards  the  various  States 
that  comprise  the  Commercial  Union.  Whatever  impediments 
the  tariffs  create  to  commercial  communication  with  foreign  lands, 
the  League  has  thrown  down  every  barrier  which  stood  in  the 
way  of  trading  intercourse  between  the  different  branches  of  the 
great  German  family,  which  the  League  represents.  And,  as  the 
conception  of  the  League  was  popular  and  national,  so  it  cannot 
be  denied  that  its  workings  have  been,  on  the  ivhole^  favorable 
to  the  prosperity  and  to  the  happiness  of  the  German  community. 
Tariffs  less  hostile  to  the  manufactures  and  foreign  commerce  of 
nations  would,  as  I  conceive,  have  greatly  added  to  the  beneficial 
effects  of  the  Union.  Its  more  extended  communications  with 
other  countries  would  have  given  greater  energy,  and  opened  a 
wider  field  to  the  increased  activity  of  the  home  trade.  There 
is  no  reason  why  foreign  commerce  should  not  have  been  bene- 
fitted  to  the  same  or  even  a  wider  extent  than  internal  industry, 
by  the  overthrow  of  that  local  legislation  which  impeded  inter- 
course, and  by  the  introduction  of  a  uniform  and  liberal  system 
of  custom-house  legislation. 

The  Zoll  Verein  now  represents  the  interests  (well  or  ill  under- 
stood) of  more  than  twenty-six  millions  of  inhabitants  of  the 
most  civilized  and  opulent  parts  of  Europe,  and  has  accomplished 
one  important  result,  namely,  of  exciting  the  attention  and  of 
awakening  the  apprehensions  of  more  than  one  neighboring  na- 
tion. What  the  Zoll  Verein  is  to  become  may  depend  as  much 
upon  others  as  upon  themselves  ;  and,  should  its  course  be  guided 
by  enlightened  economy  and  sound  commercial  policy,  it  may 
become  an  instrument  of  incalculable  and  boundless  good. 

Long  before  the  Zoll  Verein  came  into  operation,  the  same 
spirit  which  led  to  its  formation  had  been  exhibited  in  various 

1  Kanke's  "  Historisch-politische  Zeitschrift." 


134  SELECTIONS. 

parts  of  Germany,  leading  to  sundry  local  and  even  national 
reforms  in  the  commercial  policy  of  the  German  States. 

Some  steps  had  been  taken  in  Prussia,  during  the  years  1816 
and  1817,  by  sundry  ordinances  to  introduce  "  a  general  and 
simple  system  of  custom-house  legislation,1  and  on  the  26th  May, 
1818,  a  new  tariff  was  published,  which  is,  in  fact,  the  ground- 
work of  the  existing  arrangements.  Before  this  period  a  different 
fiscal  system  prevailed  in  different  parts  of  the  Prussian  kingdom. 
The  imposts  in  Brandenburg  amounted  to  69  groschen  —  75.  4d. 
per  individual ;  in  Silesia  they  were  only  22  groschen  —  2s.  ^d. 
The  new  law  allowed  the  unrestricted  circulation  of  all  foreign 
products  which  had  once  passed  the  frontier,  and  the  free  transit 
of  all  home  productions.  The  intention  of  this  tariff  of  1818  was 
to  establish  10  per  cent,  as  the  maximum  of  protection  ;  and, 
had  the  intention  of  the  Prussians  been  carried  into  effect,  there 
would  have  been  no  grounds  for  complaint. 

In  speaking  of  the  Prussian  tariff  to  the  House  of  Commons, 
on  the  7th  May,  1827,  Mr.  Huskisson  stated  "that  the  duties  on 
the  internal  consumption  of  British  goods  are  what  we  should  con- 
sider very  low  upon  most  articles,  fluctuating  from  5  to  10  per 
cent.  —  upon  no  one  article,  I  believe,  exceeding  15  per  cent.  ;" 
but  this  was  undoubtedly  an  incorrect  view  of  things,  for  it  will 
appear,  on  the  investigation  of  the  matter,  that  the  duties  on 
many  articles  of  British  manufacture  vary  from  20  to  roo  per 
cent,  upon  the  value  ;  and  though  no  doubt  the  duty  (being  levied 
on  the  weight)  has  much  increased  in  ad  valorem  amount  since 
1827,  it  was,  even  then,  from  20  to  60  per  cent,  on  various  low- 
priced  manufactures  ;  nor  was  Mr.  Huskisson  warranted  in  saying 
that  the  low-priced  manufactures ;  nor  was  Mr.  Huskisson  war- 
ranted in  saying  that,  kt  in  the  whole  Prussian  tariff,  there  is  not 
a  single  prohibition,"  inasmuch  as  imports  of  salt  and  playing- 
cards  are  wholly  prohibited,  except  for  government  account. 

The  most  important  step  by  which  evidence  was  given  of  the 
tendency  of  the  different  States  of  Germany  to  amalgamate  their 
interests  and  to  establish,  instead  of  many  tariffs,  one  single 
system,  was  the  union  of  Bavaria,  Wiirtemberg,  Hollenzollern- 
Sigmaringen,  and  Hollenzollern-Hechingen,  in  the  commercial 
league  of  28th  July,  1824.  Baden,  the  two  Hesses,  and  Saxony 
were  afterwards  invited  to  join  the  League.  The  government  of 

1  See  especially  the  ordinance  of  nth  June,  1816 —  "  Zur  Aufhebung  der  Wasser-Biunen 
und  Provinzialzolle  zunachst  in  den  alten  Provinzen  der  Monarchic." 


THE   ZOLLVEREIN.  135 

Prussia,  alive  to  the  state  of  public  opinion,  had  entered  by 
various  treaties,  from  1819  to  1830,  into  a  commercial  league 
with  Grand  Ducal  Hesse,  Lippe  Detmold,  and  some  smaller 
states,  and  in  December,  1826,  the  enclaves  (such  portions  of  the 
territory  as  are  surrounded  by  another  State)  of  Mecklenburg- 
Schwerin,  Ripen-Hesseland,  Schoenberg,  Anhalt-Kothen, 
Anhalt-Dessau,  Hesse-Homburg,  and  other  States,  joined  the 
Prusso-Hessian  Union;  while,  in  1831,  Saxony,  Electoral 
Hesse,  Saxe  Weimar,  Saxe  Meiningen,  Saxe  Coburg,  Saxe 
Altenburg,  and  other  united  themselves  to  the  Bavaro-Wurtem- 
berg  league.  Each  of  these  two  great  branches  naturally  sought 
to  extend  its  influence,  and  each  prepared  the  way  for  a  fusion  of 
the  whole  in  one  great  association. 

On  the  22d  March,  1833,  a  treaty  was  concluded  between 
Prussia,  Bavaria,  Wurtemberg,  Electoral  and  Ducal  Hesse  ;  on 
the  30th  March  of  the  same  year,  Saxony  joined  the  association  ; 
on  the  nth  of  May,  Anhalt  and  Ducal  Saxony  united  themselves. 
The  ratifications  were  exchanged  on  the  nth  of  May.  This 
treaty  is  the  basis  of  the  Zoll  Verein,  or  Commercial  League. 
It  will  be  found  at  length  in  the  Appendix  I.  (Parl.  Doc.  p. 
73—78)  ;  In  183^  Baden  vinited  itself  to  the  League,  and  Nassau 
and  Frankfort-on-the-Maine  have  also  become  parties. 

The  first  Prusso-Hessian  Union,  taking  the  name  of  the  Preus- 
sisch-Hessischen  Zoll  Verbande,  comprising  many  smaller 
States,  such  as  Anhalt  Dessau,  Anhalt  Neuberg,  Saxe  Coburg 
Gotha,  Anhalt  Kothen,  Schwartzburg  Sondenhausen,  Hesse 
Homburg,  Schwartzburg  Rudolstadt,  etc.,  represented,  accord- 
ing to  the  census  of  1831,  a  population  of  13,936,087  souls,  and 
contained  a  territory  of  5,278  square  German  miles.  In  1833  it 
had,  by  the  union  of  Electoral  Hesse  and  the  increase  of  popula- 
tion, augmented  the  number  of  souls  to  14,827,418,  and  the 
territory  to  5'4^°  square  German  miles.  The  States  of  Thur- 
ingia,  containing  about  900,000  inhabitants,  had  also  their 
commercial  and  toll  union  before  they  joined  the  Prussian 
League  in  1833,  while  Bavaria,  Wurtemberg,  Saxony,  and 
Baden,  brought  between  8  and  9  millions  of  population,  and  nearly 
2,500  square  German  miles  of  territory  into  the  confederation. 

The  following  table  exhibits  the  population  of  the  States  now 
comprising  the  German  Custom-house  Union,  to  serve  as  a  basis 
for  the  Division  of  the  Receipts  at  Triennial  Periods. 


136 


SELECTIONS. 


No.  in  Order.  ! 

Designation      of      the 
States     which      have 
given  their  assent  in 
their  own  name. 

Extent   of 
territorial 
surperfi- 
cies     in 
square 
miles. 

Extent    of 
the      Cus- 
tom-house 
frontier  in 
miles. 

Population    according 
to  the  Census  agreed 
upon  on  the   3151  of 
December,    in 

1834.               '837- 

Observa- 
tions. 

a 
3 
4  • 
5 

6 
1 
8 

9 

10 

Prussia,  and  the  States 
which  have  come  to 
an     agrement     with 
her     

5.157^0 
1  .477,^0 

385  Vk0 

ii9M 

4/0^ 

774^ 
S8IU° 

4,25',  "8 
i,59S,66S 
1,627,122 

640,674 
769,691 
908,478 
373,6oi 

25,090,898 
60,000 

4i3'9,8S7 
1,652,114 
1,667,901 
1,264,614 
652.761 
79'.  736 
93  ',340 
383,730 

25,982,333 
60,000 

Total    for 
Divi'n. 

Bavaria    

Wurtemberg  
Gr;md  Duchy  of  Baden. 
Electorate  of  Hesse    . 
Grand  Duchy  of  Hesse. 
Thuringian  States   .   . 
Duchy  of  Nassau     .   . 

Frankfort1  

...... 

8,252  jVo 

,*,,% 

25,150,898 

26,042,333 

Total    for 
Population. 

1  NOTE.  — The  population  of  Frankfort  is  not  taken  into  the  Division  of  the  Revenues, 
as  this  town  receives  an  inalienable  and  invariable  sum  calculated  on  the  basis  of  a  popu- 
lation of  60,000  souls  (63,936). 

The  Zoll  Verein  had  to  contend  with  a  strong  opposition  in 
its  origin,  not  only  from  some  of  the  States  whose  local  position 
forced  them  into  the  union,  but  from  other  German  States  that 
continued  independent,  for  the  tariff  pressed  equally  on  all,  not 
parties  to  the  League,  whether  neighbors  or  foreigners.  The 
Prussian  tariffs  of  1818  had  been  strongly  resisted  by  Electoral 
Hesse,  Cassel  and  other  States.  Saxony  denounced  them  as 
hostile,  nay,  fatal  to  her  manufacturing  and  commercial  interests. 
Yet  it  cannot  be  denied  that  the  tariffs  of  1818  were  a  great  im- 
provement upon  the  previously  existing  legislation,  for  they 
replaced  multitudes  of  prohibitions  and  prohibitory  duties  by 
moderate  imports.  In  1826  the  question  of  a  union  between 
Prussia,  and  Hesse  Darmstadt  was  discussed,  and  an  inquiry  was 
made,  in  case  Hesse  Darmstadt  should  unite  with  Bavaria  and 
Wurtemberg,  whether  Prussia  would  be  willing  to  entertain  the 
subject  of  a  commercial  treaty.  The  first  answer  of  Prussia  was 
unfavorable,  but  the  difficulties  were  at  last  surmounted,  and  the 
League  before  referred  to  was  formed  between  Prussia  and  Hesse 
Darmstadt,  of  which  the  Prussian  tariff  of  1818  was  the  basis, 


THE  ZOLLVEREIN.  137 

the  custom-houses  between  the  two  countries  being  wholly  re- 
moved—  each  State,  however,  reserved  the  right  to  establish 
duties  of  consumption  on  sundry  articles  of  food  and  drink;  and 
Prussia  was  allowed  to  maintain  the  monopoly  of  salt  and  playing- 
cards. 

The  objects  proposed  by  the  Zoll  Verein  were  the  removal  of 
all  restrictions  to  communication  and  transit,  the  abolition  of  all 
internal  custom-houses,  the  establishment  of  a  common  tariff  and 
system  of  collection,  and  the  repartition  of  the  receipts  on  all 
imports  and  exports  according  to  the  population  among  all  the 
members  of  the  League.  The  States  reserved  to  themselves  the 
right  of  introducing  any  local  arrangements  which  did  not  inter- 
fere with  the  general  principles  —  of  nominating  the  functionaries 
of  their  own  districts,  and  of  examining  the  accountancy  of  any 
part  of  the  League.  The  League  is  bound  not  to  interfere  with 
matters  of  local  revenue,  such  as  port-dues,  turnpikes,  tolls,  etc. 
The  Prussian  tariff  of  1818  was  recognized  as  establishing  the 
maximum  of  duties.  It  was  determined  that  a  common  system  of 
moneys,  weights,  and  measures,  should  replace,  as  soon  as  possi- 
ble, the  various,  complicated,  and  discordant  usages  of  the  differ- 
ent States  of  the  union,  and  that  the  whole  influence  of  the 
union  should  be  directed  towards  the  extension  of  its  commercial 
relations  with  other  States.  The  intention  of  the  tariff  is  to 
admit  raw  materials  without  any,  or  on  merely  a  nominal,  duty. 
The  lightest  duty  levied  is  on  silk  goods,  amounting  to  no  dol- 
'lars  per  cwt.,  or  about  3  shillings  sterling  per  Ib.1  The  common 
rate  of  duty  is  half  a  dollar,  or  is.  6d.  per  cwt.  on  all  articles 
not  specially  excepted.  The  tai'iff,  as  fixed  by  the  Congress  which 
has  just  closed  its  labors,  will  be  found  in  the  Appendix  II. 
(Parl.  Doc.,  p.  76). 

It  would  ill  become  me,  in  this  report,  to  discuss — though  I 
cannot  pass  over  in  absolute  silence  —  the  probable  political  con- 
sequences of  the  establishment  of  the  Zoll  Verein.  They  cer- 
tainly were  not  lost  sight  of  by  its  founders.  The  intimate 
connection  between  commercial  and  political  interests  is  obvious  ; 
and  the  advocates  of  the  League  did  not  fail  to  perceive  that  no 
political  alliance  would  be  so  strong  as  that  based  upon  a  com- 
munity of  pecuniary  and  social  interests.  The  jarring  of  differ- 
ently constituted  institutions,  the  local  jealousies  which  still  exert 

i  The  duly  levied  by  the  English  tariff  on  silk  goods  is  from  us.  to  273.  6d.  per  Ib. 


138  SELECTIONS. 

their  influences,  the  clashing  of  personal  and  privileged  interests 
with  the  public  weal,  have  prevented,  to  a  certain  extent,  the 
fusion  which  would  otherwise  have  taken  place,  so  that  the 
political  and  the  commercial  policy  are  not  always  identified ; 
but  it  cannot  be  denied  that  under  a  wise  direction  the  machinery 
of  the  Zoll  Verein  would  become  a  very  mighty  political  engine, 
which  would  be  brought  to  bear  with  great  power  upon  the 
future  concerns  of  Europe  and  the  world  at  large. 

The  general  feeling  in  Germany  towards  the  Zoll  Verein  is, 
that  it  is  the  first  step  towards  what  is  called  the  Germanization 
of  the  people.  It  has  broken  down  some  of  the  strongest  holds 
of  alienation  and  hostilitv.  By  a  community  of  interests  on 
commercial  and  trading  questions  it  has  prepared  the  way  for  a 
political  nationality,  —  it  has  subdued  much  local  feeling,  preju- 
dice, and  habit,  and  replaced  them  by  a  wider  and  stronger 
element  of  German  nationality. 

The  Zoll  Verein,  by  directing  capital  to  internal,  in  preference 
to  external,  trade,  has  already  had  a  great  influence  in  improving 
the  roads,  the  canals,  the  means  of  travelling,  the  transport  of 
letters  ;  in  a  word,  in  giving  additional  impulse  to  inland  com- 
munications of  every  sort.  The  isolation  of  the  several  German 
States,  with  separate  fiscal  interests,  and  often  hostile  legislation, 
prevented  those  facilities  from  being  given  to  intercourse  which 
are  alike  the  evidence  and  the  means  of  civilization.  On  every 
side  beneficial  changes  are  taking  place.  Railways  are  being 
constructed  in  many  parts  of  the  German  territory,  steamboats 
are  crowding  the  German  ports  and  coasting  along  the  German 
shores ;  everything  is  transported  with  greater  cheapness  and 
rapidity. 

But  whatever  opinions  may  be  formed  as  to  the  effect  of  the 
Commercial  League  upon  British  interests,  it  is  now  too  late  to 
discuss  them  beneficially.  The  League  exists,  and  is  not  likely 
to  be  broken  up  ;  the  separate  interests  of  the  different  States  are 
blended  in  the  common  interests  of  the  Zoll  Verein ;  all  the 
topics  of  comparison  between  the  general  tariff"  and  the  tariffs 
which  previously  existed  in  the  various  independent  States  of 
the  union  are  now  removed ;  whatever  existed  of  local  fiscal 
influence  is  merged  in  the  common  alliance,  and  the  League 
must  now  be  accepted  and  treated  with  as  a  body  more  influential 
than  were  any  of  its  members,  —  capable  of  controlling  the 


THE   ZOLLVEREIN.  139 

smaller  influences  of  its  component  parts  by  the  concentrated 
influence  of  the  whole. 

It  is  natural  that  a  body  so  powerful  as  the  Commercial  League 
should  seek  to  extend  its  influence.  More  coasts,  more  ports, 
and  more  shipping  are  the  three  desiderata  which  are  put  for- 
ward by  its  advocates  and  members.  For  the  coasts  and  the 
ports  of  the  Baltic  belonging  to  the  union  are  so  much  cramped 
and  prejudiced  by  the  Sound  dues  that  they  cannot  meet,  in  any 
of  the  great  emporiums  of  trade  out  of  the  Baltic,  the  competi- 
tion of  the  ports  and  coast  south  of  the  Baltic  ;  while  the  ports, 
such  as  Hamburg,  Rotterdam,  etc.,  which  are  the  natural  outlets 
of  the  great  rivers  which  run  through  the  provinces  of  the 
League,  all  belong  to  States  not  associated  with  it.  The  subject 
has  been  discussed  of  giving  a  flag  to  the  Zoll  Verein,  as  it  has 
already  a  coinage  ;  but  to  possess  a  marine,  both  warlike  and 
commercial,  in  order  to  compete  with  the  growing  squadrons  of 
Russia,  and  to  be  on  a  level  with  the  Hanse  Towns  and  with 
Holland,  is  an  object  much  insisted  on,  but  which  does  not  seem 
to  present  any  immediate  pi'ospects  of  realization. 

On  the  3Oth  of  July,  1838,  an  arrangement  was  made  (Appen- 
dix, III.,  P.  D.  p.  95,)  for  introducing  a  unity  of  currency,  to  take 
effect  from  the  ist  of  January,  1841,  the  unity  to  consist  of  the 
mark,  weighing  233-^^0  grammes. 

The  mark  to  be  represented  by  14  dollars  ;  the  dollar  by  if 
florins  ;  and  the  florin  to  be  ^  of  a  dollar. 

The  accounts  to  be  kept  either*  in  dollars  (Prussian  crowns)  or 
florins  (guilders). 

Two  millions  of  pieces  of  two  dollars  each  are  to  be  coined 
before  the  ist  of  January,  1842.  The  coinage  has  already  been 
introduced  :  it  bears  the  effigies  of  the  King  of  Prussia,  and  has 
on  the  reverse  the  inscription  of  Vereins  Miinze,  or  "Associa- 
tion's Money." 

The  future  influences  and  direction  of  the  Zoll  Verein  will  be 
determined  not  alone  by  the  growing  strength  of  the  interests  it 
represents,  but  by  the  direction  which  foreign  nations  trading 
with  Germany  may  be  able  or  willing  to  give  to  their  own  com- 
mercial legislation  ;  for,  however  enlightened  may  be  the  policy, 
and  however  sincere  the  purpose,  of  the  statesmen  of  Germany 
to  prevent  the  League  becoming  an  instrument  for  advancing  the 
minor  interests  of  certain  classes  of  producers,  as  opposed  to  the 
major  interests  of  greater  producers,  and  to  the  general  interests 


I4O  SELECTIONS. 

of  the  whole  body  of  consumers,  all  experience  shows  that  the 
minor  interest,  being  more  youthful,  vigorous,  and  concentrated, 
weighs  in  the  balance  for  much  more  than  its  real  value.  The 
agricultural  interest,  for  example,  which  in  the  States  of  the  union 
is  the  most  diffused,  the  most  important,  and  the  most  productive, 
will  not,  in  the  contest  with  the  rising  manufacturing  interest, 
obtain  its  full  share  of  power,  dependent  as  it  must  naturally  be 
to  a  great  extent  on  the  demands  of  foreign  markets.  For  it  is 
to  foreign  markets  alone  it  can  look  for  the  sale  of  that  surplus 
produce  which  home  demand  does  not  consume,  and  which,  as 
ong  as  it  remains  without  vent,  must  create  a  depression  in 
the  price  of  the  whole  quantity  produced.  Hitherto  the  oper- 
ation of  the  Zoll  Verein  has  been  to  strengthen  the  manufacturing 
interest  at  the  expense  of  the  agricultural.  As  the  foreign  de- 
mand for  agricultural  produce  has  been  uncertain  and  capricious, 
the  low  average  prices  have  operated,  on  the  one  hand,  in  forcing 
capital  out  of  agricultural  into  manufacturing  channels;  while  the 
cheap  price  of  food  has  given  to  the  German  artisan  great  advan- 
tages in  his  competition  with  the  labor  of  countries  in  which  the 
price  of  food  is  relatively  higher. 

Were  foreign  markets  accessible  to  the  German  agriculturist, 
there  is  no  doubt  the  flow  of  capital  towards  manufactures  would 
be  checked,  first  by  the  increased  demand  for  agricultural  labor, 
and,  secondly,  bv  the  loss  of  the  advantage  which  the  German 
artisan  now  possesses  in  the  comparative  cheapness  of  food.  For 
the  prices  of  the  countries  which  would  be  importers  of  German 
corn,  for  example,  would  determine  the  prices  of  corn  in  the 
German  markets  for  the  German  consumer.  In  his  own  market 
he  must  give  the  same  price  as  the  foreign  buyer  who  comes  into 
that  market. 

One  of  the  great  difficulties  with  which  sound  commercial 
principles  have  had  to  contend,  in  Germany  as  elsewhere,  is  the 
too  general  adoption  of  a  phraseology  which  has  grown  out  of  a 
vicious  legislation,  and  has  to  a  great  extent  popularized  error. 
High  duties  on  imported  articles  are  justified  by  the  plea  that  it 
is  necessary  to  afford  protection  to  the  producer,  while  the  sub- 
stantial fact  of  the  consequent  sacrifice  of  the  consumer  is 
wholly  kept  out  of  view.  For  one  case  in  which  the  loss  to  the 
many  is  put  forward,  there  are  a  thousand  in  which  the  profits  to 
the  few  are  urged  as  sufficient  sanction  to  perverse  legislation. 


THE   ZOLLVEREIN. 


141 


Dieterici1  gives  a  very  curious  table  (p.  127),  showing  the 
operation  of  the  Zoll  Verein,  during  the  years  1833  to  1835,  on 
imported  articles. 

On  foreign  articles  of  consumption  not  coming  into  competi- 
tion with  German  articles  the  increase  in  the  three  years  is  ns  54 
to  46  ;  in  foreign  articles  of  consumption  competing  with  Ger- 
man articles  the  decrease  is  as  24  to  29  ;  in  half-manufactured  ar- 
ticles serving  for  further  labor  the  increase  is  only  fi-om  9,161  to 
9,520 ;  while  in  wholly  manufactured  articles  the  decrease  is 
from  13  to  10.  .  .  . 

The  facilities  created  for  communication  by  the  improvement 
of  roads,  canals,  etc.,  have  greatly  aided  the  inland  trade  of  Ger- 
many. At  the  close  of  the  last  war  there  were  no  roads  of  the 
first  class  either  in  Pomerania,  Posen,  or  Prussia  proper.  In 
1816  the  number  of  German  miles  laid  down  in  Chausees  was 
5231  =  2,408  English;  in  1828  it  was  1,062^  —  4,889;  and  in 
1831,  1,228^  =  5,610;  and  this  amount  has  been  greatly  increased 
at  the  present  time. 

Of  the  activity  of  communication,  the  following  official  returns 
of  the  quantities  of  goods  which  passed  through  Priegnitz  will 
furnish  remarkable  evidence  :  — 


Ijj 

3 

I 

1 

Years. 

«*« 

1 

. 

§ 

3 

1 

c. 

.2 

C  J3 
X  0 

~  — 

I 

PQ 

! 

1 

m 

i 

1 

1 

1 

Cwt. 

Cwt. 

Cwt. 

Cwt. 

Cwt. 

Cw/. 

Ctvt. 

Cwt. 

1830.   . 

246,934 

683,020 

446,557 

48,322 

138,813 

'53>3'4 

1,716,963 

1831  .  . 

229,412 

59S,6io 

519,086 

45,574 

46,088 

34.o88 

i  ,628,954 

1833  .  . 
1833.   . 
IS34-   • 

246,145 
260,564 
307,087 

720,289 
700,858 
927,764 

540,246 
477,979 
755,038 

53.297 
32,962 

26,575 

147,617 
132,612 
221,623 

57,213 
50,948 
70,728 

18,489 
9,694 
11,067 

94.899 
80,595 
906,112 

1,878,199 
1,746.196 
3,225,998 

It  must  not  be  forgotten  that  Great  Britain  had  long  enjoyed 
peculiar  advantages  in  the  facilities  of  communication  ;  and  to 
these  facilities  much  of  the  activity  and  success  of  her  manufactur- 
ing and  commercial  industry  is  attributable.  For  many  years  her 
progress  in  this  respect  created  almost  a  monopoly  of  benefit;  but 

1 1  have  had  occasion  constantly  to  consult  Dieterici's  "  Statistische  Uebersicht  der  wich- 
tigsten  Gegenstande  des  Verkehrs  und  Verbrauchs  im  Preussischen  Staate  und  im  Deut- 
schen  Zollverbande,  von  1831  bis  1836,  aus  amtlichen  Quellen  dargestellt,"  Berlin,  1838. 
The  valuable  facts  he  has  collected  will  be  found  scattered  over  the  whole  of  this  report. 


142  SELECTIONS. 

the  advantages  she  enjoyed  are  now  participated  in  by  other  na- 
tions ;  and  in  Germany  especially  great  advances  have  been  made, 
and  continue  to  be  made,  in  all  those  improvements  which 
facilitate  intercourse. 

It  is  obvious  that  England  cannot  long  maintain  exclusive  pos- 
session of  advantages  which  civilized  man  is  everywhere  success- 
fully struggling  to  obtain.  Railroads  are  now  being  introduced 
between  the  principal  towns  in  the  Zoll  Verein,  —  those  between 
Dresden  and  Leipzig  and  between  Berlin  and  Potsdam  are  com- 
pleted, many  others  are  begun,  and  a  still  greater  number  are 
projected  ;  and  in  these  enterprises  the  undertakers  have  all  the 
advantages  of  our  experience.  The  number  of  canals  has  con- 
siderably increased  ;  steamers  are  giving  great  development  to 
river  navigation  ;  and  even  in  those  branches  of  industry  in  which 
our  superiority  is  the  most  marked,  such  as  the  manufacture  of 
machinery,  competition  is  marching  after  us  with  rapid  strides. 

But,  independently  of  the  progress  of  Germany  towards  a 
participation  in  the  advantages  which  for  a  series  of  years  have 
been  almost  exclusively  possessed  by  Great  Britain,  she  has  apti- 
tudes and  facilities  of  her  own  which  must  greatly  aid  her  in  the 
development  of  her  industry.  The  frugal  and  economical  habits 
of  the  German  people  enable  them  to  procure  a  far  greater  pro- 
portion of  comforts  for  the  same  proportional  rate  of  wages  than 
are  generally  obtained  by  the  English  laborer ;  added  to  which  a 
simpler  mode  of  life,  a  smaller  consumption  of  animal  food,  and 
a  less  costly  class  of  garments,  leave  out  of  their  smaller  earnings 
a  larger  amount  of  savings.  Their  savings  are,  for  the  most  part, 
invested  in  the  purchase  of  the  house  in  which  they  dwell,  and 
the  garden  which  they  cultivate,  —  whose  cultivation  is  alike  a 
source  of  health,  enjoyment,  and  profit,  being  in  most  cases 
a  valuable  auxiliary  to  manufacturing  industry.  Nor  ought  the 
general,  the  almost  universal  education  of  the  population,  be  for- 
gotten as  immensely  contributory  to  the  public  prosperity.  Ele- 
mentary instruction  is  provided  for  all,  and  special  instruction  for 
those  who,  in  any  department  of  art  or  industry,  exhibit  any  par- 
ticular aptitude.  I  have  given  in  the  Appendix  (IV.,  P.D.  pp. 
96-7),  a  short  account  of  the  Gewerbe-Schule  at  Berlin,  which 
under  the  admirable  superintendence  of  M.  Banth  (whose  services 
to  his  country  are  beyond  all  estimate,  and  above  all  praise),  has 
first  gathered  from  every  part  of  the  kingdom  the  youths  best  fitted 
for  scientific  training ;  and,  after  a  thorough  course  of  education, 


THE   ZOLLVEREIN.  143 

has  again  dispersed  them  over  the  country.  The  gradual  diffu- 
sion of  a  knowledge  and  a  taste  for  art  over  the  whole  field  of 
German  industry,  its  happy  influence  upon  all  manufactures, 
exhibited  in  a  thousand  evidences  of  improvement,  are  obvious 
to  every  observer.  Manual  skill  and  experience,  more  and  more 
intimately  associated  with  scientific  instruction,  have  been  long 
preparing  the  most  important  results ;  and  when  the  '  rising 
generation  of  intelligent  artisans  bring  their  information  and  taste 
into  the  wide  region  of  manufacturing  and  commercial  competi- 
tion, there  can  be  no  doubt  of  their  contributing  largely  to  the 
general  wealth  and  weal. 

The  tariff"  of  the  Zoll  Verein  has  no  other  prohibitions  than 
those  of  salt  and  playing-cards,  which  are  monopolies  in  Prussia  ; 
and  the  principle  of  the  tariff  is  to  admit  raw  material,  and  mate- 
rials serving  the  ends  of  agriculture  and  manufactures,  either  on 
very  low,  or  without  any,  duties.  Thus,  raw  cotton,  wool,  coals, 
pig-iron,  ores,  raw  hides,  and  skins,  hare  and  rabbit  skins,  pot- 
ashes, common  pottery,  turpentine,  common  furniture,  chalk, 
rags,  raw  refuse  of  sundiy  manufactures,  trees  for  planting, 
manure,  earths,  fish,  grass  and  hay,  garden  produce,  birds, 
blacklead,  worn  clothes,  precious  metals,  wood,  turf,  fresh  fruit, 
milk,  seeds,  etc.,  pay  no  duties  at  all. 

The  objections  to  the  tariff'  of  the  Zoll  Verein  are  twofold  ; 
they  refer  to  the  amount  of  duties  levied,  and  to  the  manner  in 
which  they  are  levied. 

The  duties  are  far  higher  than  the  Prussian  government  pro- 
fessed its  intention  to  levy.  They  were  intended  to  represent 
the  tariffs  of  Prussia.  Now,  in  the  communication  of  Baron 
Maltzahn  to  Mr.  Canning,  dated  Dec.  25,  1825,  and  laid  before 
Pai'liament,  by  order  of  Her  Majesty,  in  answer  to  the  address  of 
the  House  of  Commons  of  ist  July,  1839,  the  words  of  the  Prus- 
sian minister  are  as  follows  :  — 

"  No  one  of  the  duties  on  imports  is  sufficiently  high  to  prevent 
the  importation  of  foreign  products,  as  is  proved  by  their  exten- 
sive sale  in  all  parts  of  the  monarchy.  The  duties  levied  on  the 
products  of  foreign  fabrics  or  manufactures  are  generally  only  10 
per  cent,  on  their  value;  on  some  they  amount  to  15  per  cent., 
but  there  are  many  which  are  more  moderate." 

But  these  representations  are  certainly  not  borne  out  by  facts  ; 
for,  not  only  do  the  duties  levied  on  manufactures  vary  from  20 
to  80  per  cent,  (instead  of  from  10  to  15  per  cent.),  but  there 


144  SELECTIONS. 

are  great  varities  of  goods  which  are  wholly  excluded  from  the 
Prussian  markets  in  consequence  of  the  elevation  of  the  tariff. 

The  manner  in  which  the  duties  are  levied  is  such  as  to  press 
most  severely,  with  reference  to  their  cost,  on  coarse,  inferior  and 
heavy  articles ;  those  least  able  to  bear  a  high  rate  of  duty  are 
most  imposed,  the  same  amount  of  duty  being  taken  on  all  species 
of  goods  made  of  the  same  raw  material  —  the  finest  qualities 
pay  the  least,  and  the  lowest  qualities  the  highest  amount.  The 
ad  valorem  principle,  which  is  in  its  nature  the  fairest,  because 
it  distributes  taxation  by  the  measure  of  wealth  and  expenditure, 
is  wholly  lost  sight  of,  and  the  goods  employed  by  the  poor  are 
visited  by  a  much  heavier  rate  of  taxation  than  those  by  the 
opulent.  The  richest  muslin  and  the  coarsest  calico,  the  cloth  of 
Sedan  and  the  serge  of  Devon  pay  the  same  amount  per  cwt. 
Hence  articles  of  low  quality  —  such  as  are  used  by  the  many, 
such  as  would  have  the  largest  sale  —  are  wholly  excluded  from  the 
markets  of  the  League. 

It  cannot  be  disputed  that  the  ad  valorem  system,  as  applied  to 
manufactures,  has  many  inconveniences  and  difficulties.  It  is 
not  easy  always  to  ascertain  even  the  approximative  value  ;  and 
with  the  number  of  custom-houses  by  which  goods  are  allowed 
to  be  imported  through  a  frontier,  both  of  sea  and  land  so  various 
and  extensive  as  that  of  the  Commercial  League,  it  would  be  out 
of  the  question  to  seek  for  a  sufficiency  of  custom-house  function- 
aries, with  knowledge  and  experience  competent  to  the  protec- 
tion of  the  revenue  against  fraud.  There  is  no  system  so  simple 
as  that  of  weight;  it  is  intelligible  to  everybody;  it  is,  too,  a 
generally  popular  system,  as  it  affords  no  latitude  for  the  caprice 
of  the  officer,  and  opens  no  door  to  the  frauds  of  the  importer. 
It  might  probably  be  associated  with  some  classification  of  arti- 
cles, if  not  too  detailed  or  complicated,  into  a  few  great  divisions ; 
but  the  desirableness  of  a  thorough  change  in  the  system  itselt 
may  well  be  doubted,  and  such  a  proposal  is  not  likely  to  be 
entertained. 

The  Americans  have  strongly  objected  to  the  system  of  levying 
duties  by  weight,  instead  of  on  value.  They  have  represented 
that  the  duty  of  5^  dollars  on  their  tobacco,  being  the  same  as 
that  levied  on  the  tobaccos  of  the  Havana  and  the  Spanish  colonies, 
is,  in  fact,  a  discriminating  duty  on  their  produce,  even  to  the 
extent  of  200  to  300  dollars  per  cent.  They  complain  that  while 
the  duties  in  the  United  States  on  the  articles  imported  from  Ger- 


THE   ZOLLVEREIN.  145 

many  do  not  upon  the  whole  amount  pay  more  than  an  average 
of  5^  per  cent.,  the  imports  from  the  United  States  into  the  Zoll 
Verein  pay  46  per  cent.  duty.  They  represent  that  Prussia  levies 
on  American  produce  a  gross  revenue  of  776,606  dollars  ;  and 
while  the  United  States  receive  only  159,663  dollars  from  imports 
of  the  Zoll  Verein.  Of  about  4  millions  of  dollars  exported  from 
the  Commercial  League  to  the  United  States  3  millions  (i£  mil- 
lions of  linens,  i  million  of  silk,  and  half  a  million  merino  and 
other  similar  articles)  pay  no  duty  at  all.  The  remaining  million 
is  principally  composed  of  glass,  hardware,  hosiery,  etc.,  paying 
from  20  to  25  per  cent. 

The  original  intention  of  the  Prussian  tariff  has  certainly  been 
much  departed  from,  and  the  general  principle  which  was  put 
forward  has  not  been  carried  out  in  its  details.  For  not  only  did 
the  Prussian  government,  in  its  official  correspondence,  declare 
that  it  was  its  purpose  not  to  lay  duties  exceeding  from  10  to  15 
per  cent.,  but  the  Commercial  League  itself  professed  to  make 
the  Prussian  tariff  the  basis  of  the  legislation  of  the  union  ;  and 
the  maximum  intended  to  be  established  by  the  Prussian  tariff 
was  an  ad  -valorem  10  per  cent,  on  manufactures  ;  for  that  tariff 
provides  that  "  The  duty  on  consumption  in  foreign  fabrics  and 
manufactured  goods  shall  not  exceed  10  per  cent.  ;  and  it  shall  be 
less,  whenever  a  smaller  duty  can  be  imposed  without  injury  to 
the  national  industry."  1  But  the  duties  levied  being,  on  cotton 
manufactures  £7  zos.  per  cwt..  on  woollens  £4  ios.,  on  hard- 
wares £8  5s.,  on  common  linens  333.,  on  fine  linens  £3  6s.,  and 
on  silks  £16  ios.,  per  cwt.,  do,  on  the  whole,  greatly  exceed  the 
proposed  10  per  cent.  The  system  of  imposing  the  duty  by 
weight  has  the  advantage  of  great  simplicity,  but  it  acts  in 
complete  hostility  to  the  ad  valorem  principle,  as  the  duty  in- 
creases, instead  of  diminishing,  with  the  lowness  and  coarseness 
of  the  article  ;  so  that  the  operation  of  the  tariff  is  as  complete 
an  exclusion  of  every  low-priced  manufacture  as  if  it  were  abso- 
lutely prohibited.  Under  the  influence  of  this  state  of  things 
the  duty  on  cotton  goods  varies  from  3^  to  120  per  cent. 

It  has  been  remarked  that  this  system  fails  in  the  very  ends 
proposed,  namely,  to  distribute  the  amount  of  protection  in  pro- 
portion to  the  backwardness  of  the  manufacture.  On  certain 
articles  the  amount  of  duty  is  so  heavy  as  completely  to  exclude 

'"  Allgemeine  Zeitung,"  2d  December,  1834. 


1 46  SELECTIONS. 


no 


foreign  competition,  where  the  home  production  requires 
such  encouragement  as  that  afforded  by  the  tariff;  and  on  others, 
where  a  protecting  duty  is  required  by  the  condition  of  the  home 
production,  the  duty  on  the  foreign  article  is  small,  and  insuf- 
ficient to  check  its  introduction.  But  the  general  result  of  the 
tariff'  is  to  exclude  the  foreign  articles  of  low  quality  and  general 
consumption,  and  thus  to  keep  the  large  demand  exclusively  for 
the  home  manufacturers.  One  baneful  effect  is,  however,  that 
the  increased  price  is  levied  on  those  who  are  least  able 
to  pay,  and  levied  on  articles  of  the  lowest  value,  for  the 
piece  goods  which  are  consumed  by  the  opulent  are  precisely 
those  upon  which  the  smallest  amount  of  duty  is  collected. 

It  has.  indeed,  been  argued  that  the  levying  heavy  duties  upon 
manufactures  of  ordinary  quality,  so  as  to  exclude  them  from  the 
markets  of  the  League,  is,  in  fact,  to  create  a  demand  for  superior 
articles,  and  so  confer  a  benefit  upon  the  German  consumer;  but 
to  the  immense  multitude  of  consumers,  cost  is  the  all-important 
consideration  ;  and,  to  deny  access  to  low-priced  articles,  —  or  by 
prohibitory  duties  on  foreign  fabrics,  considerably  to  elevate  the 
price  of  the  home-made  article,  —  is,  in  all  cases,  to  levy  an  un- 
fair and  unequal  contribution  on  the  poor,  and  in  many  cases 
wholly  to  exclude  them  from  the  enjoyment  of  what  would  other- 
wise be  accessible  to  them.  In  fact,  to  exclude  the  ordinary- 
manufactures  of  foreign  countries  is  to  give  a  special  premium 
to  the  production  of  ordinary  manufactures  at  home,  is  to  create 
for  the  least  advanced,  the  least  intelligent  industry,  a  field  of 
peculiar  favor;  and  it  may  be  well  doubted  if  the  monopoly  thus 
established  for  the  manufacture  of  low  articles  is  beneficial  to 
them.  That  it  is  prejudicial  to  the  consumers  is  obvious,  but 
some  of  the  ablest  writers  on  the  Zoll  Verein  have  expressed  their 
conviction  that  the  uncontrolled  power  given  to  the  German 
manufacturer  of  low  articles  in  the  German  market  is  baneful  as 
well  to  his  own  as  to  the  public  interest.1 

The  tendency  of  opinion  in  Germany  is  towards  free  trade. 
Almost  every  author  of  reputation  represents  the  existing  system 
as  an  instrument  for  obtaining  changes  in  favor  of  commercial 
liberty.  One  of  the  most  distinguished  writers  on  the  com- 
mercial league,  in  cautioning  the  capitalist  from  embarking  his 
wealth  in  the  protected  branches  of  industry,  says,  "  You  are 

1  See  Osiander,  "  Betrachtungen  iiber  den  Zoll  Preussischen  Tarif."  Stutgart,  1837,  pp. 
89,90. 


THE   ZOLLVEREIN.  147 

building  ships  which  are  not  prepared  for  the  storm.  You  are 
creating  interests  which  cannot  make  their  way  through  a  crisis; 
you  are  erecting  edifices  upon  sand."  J 

It  should  be  borne  in  mind,  however,  that  the  tariffs  of  the  Zoll 
Verein  are  far  more  liberal  than  the  old  tariffs  of  Prussia,  which 
were  intended  wholly  to  exclude  foreign  manufactures.  But 
diminished  duties  have  not  injured  her  own  manufactures.  No 
man  is  found  to  deny  that  they  have  made  a  much  greater  progress 
under  a  less  protection  than  they  m:ide  when  the  home  market 
was,  by  a  greater  protection,  closed  against  foreign  competition. 

The  Prussian  tariff'  of  ibiS  was  a  great  improvement  on  pre- 
ceding legislation,  but  it  contained  many  incongruities,  which 
were  changed  by  the  tariff'  of  1822.  On  many  articles  the  duties 
varied  between  the  eastern  and  western  provinces.  Common 
cloths,  which  paid  26  rix-d.  22^  gr.,  and  fine  cloths  paying 
47  rix-d.  loS/g  gr.  in  the  eastern  provinces,  paid  only  22  rix-d. 
18^4  gr.  and  43  rix-d.  7^  gr.  in  the  western  ;  cotton  twist  paid 
2  rix-d.  10  gr.  in  the  eastern,  and  only  half  that  amount  in  the 
western  provinces  ;  while  dyed  twist  paid  6  rix-d.  17^  gr.  in  the 
former,  and  5  rix-d.  17^  gr.  in  the  latter.  White  and  colored 
woven  cottons  and  cottons  mixed  with  thread  paid  the  same 
duties  as  fine  woollens,  viz.,  47  rix-d.  1054  gr.  and  43  rix-d. 
7.^2  gr.  ?  and  printed  and  fine  cottons,  61  rix-d.  3^  gr.  in  eastern, 
and  57  rix-d.  in  western  districts  ;  gray  linens  2  rix  d.  and  i  rix-d. 
22/^  gr.,  and  bleached,  12  rix-d.  6^3  and  8  rix-d.  S*/3  gr.  ; 
silks,  171  rix-d.  314  gr-  in  the  eastern,  and  167  rix-d.  in  the 
western  department;  half-silks,  79  rix-d.  13^  gr.,  and  75  rix-d. 
10  gr.  Common  iron  goods  paid  6  rix-d.  17^  gr.  in  the  east,  and 
5  rix-d.  2^2  gr.  in  the  west;  fine  iron  goods,  24  rix-d.  12^  gr., 
and  20  rix-d.  10  gr.  ;  and  cutlery  and  fine  hardware,  79  rix-d. 
13^  gr.  and  75  rix-d.  10  gr.  The  tariff'  of  1822  left  the  distinc- 
tion only  existing  on  cotton  twist ;  introduced  a  uniform  duty  of 
30  rix-d.  on  woollens,  and  6  rix-d.  on  dyed  twist;  50  rix-d.  on 
cottons  generally,  but  reduced  the  duty  on  cottons  mixed  with 
thread  to  .10  rix-d.,  which  it  also  levied  on  bleached  linens; 
lowered  the  duties  on  silks  to  100  rix-d.,  and  on  half-silks  to 
50  rix-d.  ;  on  common  iron  goods  levied  6  rix-d.,  on  fine  10  rix-d., 
and  on  cutlery,  and  hardware  50  rix-d. 

Thus  the  tariff'  of  1822  was  in  every  respect  an   improvement 

1  See  Osiander,  "  Betrachtungen,"  p.  97. 


148  SELECTIONS. 

on  that  of  1818.  In  1825  the  duties  on  woollen  warps  were  re- 
duced from  30  rix-d.  to  10  rix-d.  ;  and  those  on  carpets  of  wool 
and  thread  from  30  rix-d.  to  20  rix-d.  ;  those  on  fine  linens  and 
cottons  mixed  with  flax  were  raised  from  10  rix-d.  to  20  rix-d. 
In  1828  the  duties  on  flannels,  meltons,  etc.,  were  reduced  from 
30  rix-d.  to  10  rix-d.,  and  on  woollen  carpets  from  30  to  20  rix-d. 

Up  to  this  period  half  the  duty  was  payable  \\\friederichs  cTor, 
which  was  an  augmentation  of  about  6  per  cent,  upon  the  tariff. 
In  1832  the  duty  on  woollen  yai'n  was  lowered  from  6  rix-d.  to  15 
silver  gr.  ;  on  carpets  in  general  it  was  lowered  from  30  rix-d.  to 
22  rix-d.  ;  on  woollens  it  was  raised  from  30  rix-d.  to  33  rix-d.  ; 
on  cotton  yarns  2  rix-d.  were  established  as  a  general  duty  ;  55 
rix-d.  on  cottons  and  cutlery,  instead  of  50,  which  50  continued 
to  be  levied  on  cotton  and  flax  manufacturers  ;  and  the  duties  on 
silk  were  raised  from  100  rix-d.  to  no  rix-d.  The  tariff"  of  the 
Zoll  Verein,  in  1834,  reduced  the  duty  on  carpets  from  32  rix-d. 
to  20  rix-d.  ;  and  on  woollens  generally  from  33  rix-d.  to  30  rix-d.  ; 
on  cottons  from  55  rix-d.  to  50  rix-d.  The  duty  on  linen  thread 
was  raised,  in  1837,  from  6  rix-d.  to  8  rix-d. ;  and  on  twisted 
cotton  to  the  same  amount.  The  tariff  of  1840  has  lowered  the 
duties  on  cutlery  and  hardware  from  55  rix-d.  to  50  rix-d. 

The  changes  introduced  by  the  Congress  of  1839  in^°  *ne  tariffs 
of  1837-9,  are  n°t  verv  considerable.  The  adoption  of  the  unity 
of  50  kil.  as  the  cwt.  of  the  tariff",  operates  as  an  elevation  of  2f 
per  cent.,  in  all  cases,  when  it  applies  to  articles,  the  duty  on 
which  is  charged  by  weight,  as  is  the  case  with  the  major  part 
of  the  goods  mentioned  in  the  tariff".  The  system  of  tarification 
has  been  simplified  throughout  by  the  cutting  oft"  all  fractions 
of  Ibs.  The  most  important  change  is  the  reduction  of  the  sugar, 
rice,  and  hardware  duties.  .  .  .  The  standard  of  the  florin 
is  altered  from  24  gold  standard  to  24^  gold  standard  ;  so  that, 
under  the  new  tariff,  the  rix  dollar  is  now  represented  by  if  fl., 
instead  of  if,  as  in  the  former  tariff".  Thus,  the  general  rate  of 
import  duty  (wfien  there  is  no  special  exception)  was,  in  1837-9, 
one-half  Prussian  dollar,  or  15  silver  gr.,  represented  by  50  kreut- 
zers  ;  but  at  present  the  general  import  duty  of  one-half  Prussian 
dollar  is  represented  by  52^  krs. 

Attached  to  the  custom-house  tariff  will  be  found  the  various 
regulations  under  which  the  transit  duties  are  levied  in  the  States 
of  the  Prussian  Union. 

The  legislature  of  Prussia  has  generally  made   the  transit   of 


THE   ZOLLVEREIN.  149 

goods  through  her  provinces  a  source  of  revenue  ;  and  it  has 
not  been  wholly  unproductive,  as  a  large  portion  of  Poland  and 
southern  Russia  import  and  export  through  the  Prussian  ports 
in  the  Baltic.  The  difficulties  which  Russian  legislation  has 
always  thrown  in  the  way  of  transit  may,  perhaps,  have  had 
some  influence  on  the  councils  of  Prussia  ;  in  fact,  the  heavy 
transit-duty  imposed  on  goods  imported  through  the  ports  of  the 
Baltic  could  hardly  be  maintained  were  the  Prussian  transit- 
system  a  wise  and  liberal  one.  The  southern  States  of  the  union 
have,  for  the  most  part,  endeavored  to  secure  through  their  ter- 
ritories a  cheap  transit  for  commodities  intended  for  other  coun- 
tries. The  general  principles  of  the  transit  law  are,  that,  — 

1.  All  articles  admitted  without  duty  shall  transit  without  duty 
through  the  Zoll  Verein. 

2.  All  articles  upon  which  the  export  and  imnort  duties,  sep- 
arate or  together,  do  not  amount  to  \  dol.  or  52  J  kr.  per  cwt.,  are 
to  pay  the  amount  of  the  said  duties. 

3."  All  articles  upon  which  the  export  and  import  duties  ex- 
ceed TJ  dol.,  or  52^  kr.  per  cwt.,  shall  pay  on  transit  ^  dol.  per 
cwt. 

But  there  are  many  exceptions.  The  exceptional  transit  duties 
levied  by  the  taiyffs  of  the  Zoll  Verein  are  :  On  cotton  and  other 
goods,  coming  or  going  through  Baltic  ports,  4  dol.  (i2s.)  per 
cwt.  ;  through  other  roads,  2  dol.  (6s.)  per  cwt.  ;  on  cotton 
twist  and  dyed  woollen  yarn,  2  dol.  ;  on  copper,  coffee,  etc.,  i 
dol.  per  cwt.  ;  on  raw  sugar,  20  s.  gr.  (2s.) 

But  goods  going  from  the  Oder  mouth  on  the  left  bank  of  the 
Oder,  westward,  towards  the  Rhine,  and  through  the  frontier  be- 
tween Neu- Benin,  in  Silesia,  to  Thorn,  in  Bavaria;  or,  entering 
the  right  bank  of  the  Rhine  again,  to  traverse  the  Rhine  for  ex- 
port, cottons,  woollens,  and  many  other  articles,  i  dol.  (38.) 
per  cwt. 

Goods  conveyed  by  the  left  bank,  or  on  the  Rhine,  or  on  the 
Moselle,  and  over  the  southern  frontier  between  Hamburg  and 
Freilassing,  or  over  the  northern  frontier  between  the  Rhine  and 
the  Elbe,  10  sq.  (is.)  per  cwt. 

Goods  conveyed  over  the  southern  frontier,  or  from  the  Rhine 
to  the  Danube,  4-^  sq.  (5^d.)  per  cwt. 

The  details  will  be  found  in  the  Appendix  (III.)  attached  to 
the  Tariff^ 

The  transit  system  of  the  Zoll  Verein  is  somewhat  complicated, 


1 50  SELECTIONS. 

and  inconsistent  with  the  general  and  simple  character  of  the  leg- 
islation. The  tables  in  the  Appendix  (V.,  P.  D.  pp.  99-112)  will 
exhibit  the  amount  of  goods  passing  through  the  various  provinces 
of  the  League.  One  general  transit  duty,  of  low  amount,  would 
certainly  be  very  favorable  to  the  carrying  trade  of  the  union  ;  nor 
are  the  reasons  quite  obvious  why,  in  the  recognition  of  a  princi- 
ple of  equality,  the  conveyance  of  goods  through  certain  States 
of  the  union  should  be  loaded  with  much  heavier  fiscal  charges 
than  through  others.  It  would  seem  more  accordant  with  sound 
principles  to  encourage  transit  through  the  districts  which  geo- 
graphically present  the  greatest  facilities,  rather  than  to  give 
advantages,  by  lower  duties,  to  districts  less  conveniently  situated. 

Perhaps  the  wisest  course,  in  the  common  interest  of  the  Zoll 
Verein,  would  be  to  completely  disassociate  all  fiscal  considera- 
tions from  the  question  of  transit,  and  to  levy  no  other  duty  than 
is  necessary  for  paying  the  expenses  of  collection  and  control. 
The  prohibitory  tariffs  of  Russia,  Poland,  and  Austria,  certainly 
require  no  new  charge  or  impediment  to  be  added  by  a  heavy 
transit  duty  to  the  cost  of  the  ai  tides  imported  through  the  States 
of  the  League.  And,  even  with  the  high  rate  of  duty  levied  (or 
perhaps  rather  on  account  of  the  high  rate  of  duty  levied) ,  the 
pecuniary  interest  to  preserve  the  present  system  is  small,  —  far 
too  small  to  counterbalance  the  disadvantages  and  detriments 
which  the  system  creates. 

Another  obvious  inconvenience  and  loss  accrues  to  the  Zoll 
Verein  from  the  motives  which  the  lower  transit  dues  of  France, 
Holland,  and  Belgium  create  for  transporting  goods  through  the 
ports  of  those  countries  instead  of  the  ports  of  Germany ;  added 
to  which,  a  habit  of  forwarding  articles  by  a  particular  line 
creates  new  interest  and  motives,  which  make  it  difficult  to  revert 
to  a  former  state  of  things.  When  business  has  been  forced  out 
of  its  natural  channel  into  a  novel  course  it  does  not  promptly 
resume  its  old  direction,  and  the  ground  lost  is  often  not  again  to 
be  won. 

The  lowest  transit  duty  levied  in  the  Zoll  Verein,  with  the 
•exception  of  the  road  from  Mayence  to  the  southern  frontier, 
is  4^  silver  gr.  (5^  d.)  per  cwt.  ;  but  on  the  main  roads  of 
Austria  transit  is  free  from  charge,  while  in  France  the  charge  is 
less  than  half  the  amount  of  the  minimum  Prussian  duty.  At 
the  same  time,  .the  advantages  which  the  railroads  of  Belgium 
offer,  and  the  free  navigation  of  the  principal  rivers  of  Germany, 


THE   ZOLLVEREIN.  151 

as  established  by  the  Vienna  Congress,  would  all  seem  to  co- 
operate in  showing  how  much  it  is  for  the  interest  of  the  League 
to  facilitate  transit  by  every  possible  means.1  The  attention 
which  has  been  of  late  years  so  successfully  given  in  Germany  to 
the  improvement  of  the  roads,  and  all  other  means  of  communica- 
tion, cannot  receive  a  greater  recompense  than  by  encourage- 
ment given  to  the  transit  trade  by  a  low  rate  of  duty  levied.  The 
profits  deposited  by  the  transport  of  merchandise,  are,  from  their 
diffusion,  apt  to  escape  attention  ;  but  perhaps  there  are  none 
which  give  a  greater  activity  to  agricultural  industry,  nor  which  are 
more  intimately  connected  with  the  public  prosperity  and  the 
general  progress  of  improvement  and  civilization. 

There  is  considerable  difficulty  in  estimating  the  amount  of  the 
imports  from  Great  Britain  into  the  States  of  the  Zoll  Verein,  as 
they  penetrate  through  so  many  channels,  —  not  only  through 
German  ports,  but  from  the  ports  of  Holland  and  Belgium  and 
the  Hanse  Towns.  From  Hamburg  and  the  Elbe  especially  a 
large  part  of  the  wants  of  the  Verein  are  supplied  ;  there  are 
also  large  importations  through  Rotterdam  and  the  Rhine,  as 
well  as  through  Bremen  and  the  Weser.  But,  by  a  comparison 
of  the  returns  of  our  imports  from  and  exports  to  the  various 
circumjacent  countries,  which  have  been  prepared  with  his 
accustomed  accuracy  and  diligence  by  Mr.  Young  (Appendix 
VI.  to  IX.,  P.  D.  pp.  113-139),  with  the  very  detailed  statements 
given  me  by  the  Prussian  government,  all  of  which  documents 
will  be  found  in  the  Appendix  (XI.  to  XVII.,  P.  D.  pp.  143-226), 
an  approximative  estimate  of  the  general  amount,  and  of  the 
special  details  of  our  commercial  intercourse,  will  be  obtained. 

Though  the  strong  and  irresistible  tendency  of  an  organization 
like  that  of  the  Commercial  League  is  to  blend  the  separate  in- 
terests of  its  component  parts  into  the  common  and  paramount 
interests  of  the  whole,  and  to  give  to  the  Union,  as  a  body,  an 
influence  sufficiently  powerful  to  predominate  over  the  local  and 
partial  influences  of  the  various  elements  of  which  that  Union  is 
composed,  still  much  time  and  much  judicious  legislation  will 
be  required,  in  order  that  the  Union  may  fairly  represent  the 
various  interests  which  are  comprehended  in  its  action.  Hap- 
pily the  greater  interests  are  and  must  long  continue  intimately 
connected  with  the  foreign  trade  of  Germany  —  for  though  the 

1  Osiander,  pp.  115-117. 


152  SELECTIONS. 

manufacturing  tendencies  of  a  portion  of  the  States  of  the  Union, 
associated  as  such  tendencies  are  with  a  restless  activity  —  a  spirit 
of  association,  a  unity  of  purpose,  a  combined  action,  which  give 
them  more  than  their  fair  and  full  importance  in  the  struggle  for 
what  is  called  "protective  legislation,"  yet  it  cannot  be  denied 
that  there  is  in  Germany  such  a  general  diffusion  of  intelligence 
as  will  check  the  sinister  interests  in  their  demand  for  prohibitory 
duties  on  foreign  manufacture.  And  at  the  present  moment  the 
agricultural  interests,  taking  in  the  whole  of  the  confederated  states, 
represent  a  vastly  greater  amount  of  capital  and  labor  than  the 
manufacturing.  The  agricultural  interest  exists  everywhere  and 
in  many  extensive  provinces  of  the  Union  without  any  counter- 
balancing manufacturing  interest,  while  the  manufacturing  inter- 
est is  to  a  great  extent  of  modern  growth,  and  confined  to  a 
limited  portion  of  the  field  of  production.  And  even  that  manu- 
facturing interest  can  only  safely  rest  upon  a  system  of  moderate 
duties ;  for  as  soon  as  it  is  able  to  supply  the  markets  of  Ger- 
many, it  must,  for  its  surplus  produce  be  thrown  into  competition 
with  the  manufacturers  of  other  lands,  and  can  only  compete  suc- 
cessfully by  cheap  production,  to  which  a  protective  and  prohibi- 
tory system  is  in  its  very  nature  opposed ;  for  its  object  and  its 
essence  are  to  promise  and  to  secure  high  prices  to  the  home 
manufacturer.  And  if  the  interest  of  Prussia  for  example  be 
considered,  Prussia,  whose  population  comprises  two-thirds  of 
the  whole  population  of  the  Commercial  Union,  it  is  certain  that 
not  only  are  her  true  interests  hostile  to  anv  system  which  pro- 
hibits the  introduction  of  foreign  manufactures,  her  capital 
engaged  in  manufactures  being  inconsiderable  ;  but  the  general 
conviction  of  the  heads  of  departments  in  Prussia  is  opposed  to  a 
protecting  legislation. 

The  financial  necessities  of  Prussia  have  frequently  been  put 
forward  as  the  reason  for  the  high  rate  of  duties  established  by 
the  tariff  of  the  Zoll  Verein  ; l  but  it  is  clear  that  many  of  the 
rates  are  far  too  high  to  be  productive  ;  some  of  them  are  wholly 
prohibitory  ;  and  the  revenue  would  cei'tainly  be  benefited  by  a 
considerable  reduction.  The  Zoll  Verein,  however,  has  never 
been  regarded  by  the  contracting  States  with  a  view  solely  to  the 
financial  question  ;  its  social  and  political  consequences  would 
reconcile  many  of  its  members  even  to  considerable  pecuniary 
sacrifices.  . 


LE   ZOLLVEREIN.  153 


LE   ZOLLVEREIN. 

(Resume  Sta  tistique. ) 

FROM  LEGOYT'S  LA  FRANCE  ET  L'ETRANGER,  VOL.  I.,  PP.  250-5. 

LE  ZoHverein  (des  deux  mots  allemands  Zoll,  douane,  et  Ve- 
rein,  association),  est  le  nom  donne  a  1'association  douaniere  qui 
existe  aujourd'hui  entre  tous  les  membres  de  la  Confederation 
germanique,  moins  1'Autriche,  les  trois  villes  Anseatiques 
(Breme,  Hambourg  et  Liibeck),  le  Mecklembourg,  les  duches 
de  Holstein  et  du  Lauenbourg,  et  la  principaute  de  Lichtenstein. 
La  Prusse  y  figure  m6me  pour  ses  provinces  placees  en  dehors  de 
la  Confederation. 

Le  principe  de  cette  association  se  trouve  dans  1'article  19  du 
traite  qui  a  fonde  la  Confederation  germanique  et  qui  est  ainsi 
con9ti :  "Ses  membres  se  reservent,  a  la  premiere  reunion  de 
leurs  plenipotentiaires  a  Francfort,  de  deliberer  sur  un  projet  de 
douanes  et  de  navigation  pour  toute  1'Allemagne."  Mais  elle 
trouvait  surtout  sa  raison  d'etre  dans  1'organisation  territoriale  et 
politique  de  l'Allemagne,  composee  de  quarante  Etats  presque 
tous  enclaves  les  uns  dans  les  autres,  ayant  chacun  ses  barrieres 
fiscales  et  son  tarif.  On  a  comte  que,  pour  parvenir  de  la  fron- 
tiere  au  centre  du  pays,  soit  du  nord  au  sud,  soit  de  1'ouest  a  Test, 
sur  un  espace  de  370  a  445  kilometres,  les  marchandises  n'a- 
vaient  pas  moins  de  seize  lignes  de  douanes  a  traverser,  non  com- 
pris  les  lignes  interieures  appartenant  a  1'Etat,  aux  communes  et 
meme  aux  particuliers  !  De  la,  des  frais  et  des  pertes  de  temps 
enormes,  qui,  en  les  grevant  outre  mesure,  ai'retaient  a  la  fois  la 
production  et  la  consommation. 

La  Prusse,  dont  les  provinces  orientales  etaient  separees  du 
reste  de  la  monarchie  par  le  Hanovre,  le  Brunswick  et  la  Hesse- 
Cassel,  et  qui  souffrait  le  plus,  peut-etre,  de  ce  morcellement  de 
son  territoire,  prit  1'initiative  des  negociations  qui  devaient  con- 
duire  au  ZoHverein  actuel.  Ses  ouvertures  furent  d'abord  accu- 
eillies  par  le  Schwarzbourg-Sondershausen,  1'une  de  ses  enclaves  ; 
puis,  de  i8[9  a  1828,  1'association  naissante  vit  successivement 
venir  a  elle  les  principautes  ou  duche's  de  Hesse-Darmstadt, 
Schwarzbourg-Rudolstadt,'  Saxe-Weimar,  Anhalt-Bernbourg, 


154  SELECTIONS. 

Anhalt-Dessau,  et  Anhalt-Coethen,  soit  pour  la  totalite,  soit  pour 
utie  partie  de  leur  territoire.  Un  certain  nombre  d'Etats  du 
second  ordre,  ayant  a  leur  tete  la  Baviere  et  le  Wuvtemberg, 
tenterent  d'enrayer  ce  mouvement  dans  lequel  ils  voyaient  un 
agrandissement  indirect  de  1'influence  politique  de  la  Prusse ; 
mais,  convaincus  de  1'inutilite  de  leui's  efforts  pour  constituer  une 
ligne  douaniere  de  quelque  importance,  ils  se  re'unirent  an  Zoll- 
verein,  le  23  mars  1833.  La  Saxe  suivit  leur  example,  le  30 
mars  de  la  metne  annee,  et  entrama  a  sa  suite  les  Etats  de  la 
Thuringe,  la  branche  Ernestine  de  Saxe,  Schwarzbourget  Reuss. 
Apres  de  longues  hesitations,  Bade  se  declara  pour  le  Zollverein 
le  12  mai  1835;  Nassau,  le  10  decembre  1835;  Francfort-sur-le- 
Mein,  le  25  Janvier  1836  ;  la  principaute  de  Lippe-Detmold,  le  18 
octobre  ;  le  Brunswick,  le  19  octobre ;  la  Hesse-Electorale  et  le 
comte  de  Schaumbourg,  le  13  novembre ;  le  comte  de  Waldeck, 
le  ii  decembre  1841  ;  le  duche  de  Luxembourg,  le  8  fevrier 
1842  ;  enfin,  le  ier  Janvier  1854,  les  derniers  Etats  restes  fideles  a 
1'association  du  Stuerverein,  c'est-a-dire  le  Hanovre  et  le  duche 
d'Oldenbourg. 

D'apres  le   recensement  de   decembre   1861,   la  population  de 
chaque  Etat  associe  s'elevait  aux  nombres  ci-apres  :  — 


Prusse    .   .  . 

Luxembourg 
K.,viere  .   .    . 


.   .  18,867,061   I  Hanovre 


7,061   i  Har 
7,7.;i  I   Wu 


97'7-i1   I   Wurtembourg     . 


4/595,424 


1,069,821 


Bade 
Hesse-Cassel  .   . 
Hesse-Darmstadt 


[,908.631 

[,720,708 
[,365,752 


Brunswick 257,624 

Oldenbourg 238,562 

Nassau 454,326 

Francfort 84,506 

Total  ......    34,670,277 


Ces  34.6  millions  d'habitantsoccupent  une  superficie  de  502,260 
kilometres  carres. 

Le  Zollverein  n'est  pas  reste  commercialement  isole.  Des  sa 
formation,  il  s'est  efforce  d'agrandir  ses  debouches  par  des  traites 
avec  les  principattx  Etats  de  1'ancien  et  du  nouveau  monde. 

Ces  traites  de  commerce  se  sont  succede  dans  1' ordre  ci-apres : 
avec  la  Hollande,  les  21  Janvier  1839  et  31  decembre  1851  ;  avec 
la  Porte,  le  19/22  octobre  1840;  avec  PAngleterre,  les  2  mars 
1841  et  ii  novembre  1857;  avec  ^a  Belgique,  les  ier  septembre 
1844,  2  Janvier  1851  et  18  fevrier  1852;  avec  la  Sardaigne,  les 
23  juin  1845,  20  mai  1851  et  28  octobre  1859;  avec  1'Autriche,  le 
19  fevrier  1853  (d'abord  avec  la  Prusse  seulement,  puis  avec  le 
Zollverein  et  plus  tarde,  aves  les  duches  de  Parme  et  de  Modene)  ; 
avec  le  Mexique,  le  30  juillet  1855  >  avec  Breme,  le  26  Janvier 
1856;  avec  la  Sicile,  le  10  aout  1856";  avec  le  Danemark,  le  14 


LE   ZOLLVEREIN. 


155 


mars  1857  ;  avec  1'Autriche  et  la  principaute  de  Lichtenstein 
(convention  monetaire),  le  24  Janvier  1857;  avec  ^a  Perse?  1£  25 
juin  1857  >  avec  ^a  confederation  Argentine,  le  19  septembre 
1857. 

L'influence  de  ces  traites  sur  le  commerce  du  Zollverein  est 
clairement  indiquee  par  le  tableau  suivant,  qui  en  fait  connaitre, 
de  1834  a  I86o,  la  valeur  moyenne  annuelle  absolue  et  par  tete 
d'habitant.  Pour  la  periode  1834-1846,  cette  valeur  a  ete  calculee 
par  M.  O.  Hiibner  (Jahrbuch  pour  1860  et  i86i]),  d'apres  des 
prix  invariables  ;  pour  les  autres  annees,  d'apres  les  prix  reels. 
Les  sommes  sont  en  millions  de  francs. 


i 

a 

.1 

, 

1 

Periodes 
et  annees. 

.2 
I 

Exportatio 

c 

Importatio 
et  export 
re'unies. 

Population 
moyenne 

Valeur  par 

,S34-,S3S    .   .   . 
1839-1843    .   .   . 
1&M-.S46    •   •    • 

477.0 
677.2 
813-4 

591.0 
662.6 

219.0 

207.4 
260.6 

1,068.0 
1,339-9 

M6S.5 

24.6 
26.7 
29.0 

43-4 
50.2 
50.6 

1850-1852    .   .    . 

704.6 
764  6 

670.5 

3I4.6 

1,375-' 

30,2 

45-S 

lfi£j 

!§«  f 

1,184.2 

foU 

2,341.4 

32.7 

7'-S 

i  ^"6 

0-- 

2  651  6 

o^o 

D'apres  ce  tableau,  1'histoire  comtnerciale  du  Zollverein  a  eu 
trois  phases  tres-distinctes.  La  premiere  comprend  la  periode 
1834—1846;  c'est  peut-etre  la  plus  brillante.  La  seconde  em- 
brasse  les  annees  de  crise  1847  a  1852.  La  troisieme  commencee 
en  1853,  se  continue  en  ce  moment;  1857  en  est  le  point 
culminant.  Vient  ensuite  une  reaction  assez  sensible,  qui, 
quoique  perdant  chaque  jour  de  son  intensite,  n'a  pas  encore 
fait  place  a  une  recrudescence  bien  caracteris^e. — Les  deux 
colonnes,  importations  et  exportations,  indiquent  la  correlation 
intime  qui  existe  toujours  et  partout  entre  ces  deux  elements 
du  commerce.  Inferieures  pendant  assez  longtemps  aux  premi- 
eres, les  secondes  ne  tardent  pas  a  les  egaler  et  meme  a  les 
depasser  dans  certaines  annees.  C'est  la  preuve  du  rapide 


1  Ou  salt  que  les  droits  de  douane  du  Zollverein  sont  etablis  au  poids.     Les  publications 
officielles  ne  font  done  pas  connaitre  la  valeur  du  commerce  de  1'association. 


156  SELECTIONS. 

deVeloppement  manufacturier  de  1'association.  Par  suite  de 
1'extension  graduelle  de  son  reseau  de  voies  ferrees,  de  1'ameli- 
oration  de  ses  voies  navigables;  et  de  la  reduction  des  droits  de 
transit  (aujourd'hui  supprimds),  son  territoire  est,  en  outre,  em- 
prunte  par  une  valeur  (calculee)  sans  cesse  croissante  de  mar- 
chandises.  Ne  perdons  pas  de  vue  toutefois  que  la  valeur, 
surtout  la  valeur  actuelle,  ne  saurait  donner,  particulierement 
dans  ces  dernieres  ann^es  ou  les  prix  ont  ete  1'objet  d'une  hausse 
si  soudaine  et  si  rapide,  la  mesure  exacte  du  mouvement  des 
^changes  et  du  transit  du  Zollverein.  L'indication  des  qtiantites 
serait  un  document  plus  precis  ;  mais  elle  exigerait  des  developpe- 
ments  qui  ne  sauraient  trouver  place  ici. 

Le  tableau  ci-apres  fait  connaitre  la  valeur  des  produits 
fabriques  que  le  Zollverein  a  impoi'tes  et  exporters  en  1834,  1844, 
et  1857.  II  n'a  d'autre  but  que  d'ihdiquer  ceux  de  ces  produits 
qui  sont  le  plus  habituellement  consommes  ou  fabriques  dans 
les  Etats  de  1'Union,  les  quantites  ayant  du  necessaire- 
ment  s'elever  avec  le  chiffre  de  la  population.  Cependant  il 
fournit  ce  renseignement  important  et  independant  du  mouve- 
ment de  la  population,  que,  tandis  que  les  importations  ne  se 
sont  accrues;  de  1834  a  1857,  que  de  36  p.  100,  les  exportations 
ont  plus  que  double.  C'est,  comme  nous  le  disons  plus  haut,  le 
signe  certain  des  progres  remarquables  de  1'industrie  manufac- 
turiere  dans  1'association. 


LE   ZOLLVEREIN. 


157 


IMPORTATIONS. 

EXPORTATIONS. 

1834. 

1844. 

1857. 

1834. 

1844. 

1857. 

Toiles  de  fil  

88.9 
34-i 

"1 

4-9 

0.2 
O.I 
3.3 
0-7 

61.5 
8.6 
14.6 

8.2 

13-1 

O.I 

0.3 

5-2 
2.2 

78.4 
16.9 
33.0 

7-1 

22.5 
0.4 

O.2 
10.9 

3-° 
0.03 

£ 

27.4 

4.? 

0.4 
0.7 
12.7 

3-4 

46.S 
57° 
40.1 
'3-5 
96.0 
0.7 
i-5 
13-9 
3-° 

100.9 

iS.o 
158.6 
1.9 

i8.o9 
6.7 
0.4 
6.0 
0.4 
52-5 

0-3 

20.2 
18.0 
22-9 

7-1 

O.2 

o-3 

ill 

0.4 

0.2 
1.9 
13-5 

7-i 

3.V2 

18.7 
16.9 

5-7 

Soieries  pures  

Fourrurcs  et  pelleteries  
Habits  d'enfants     

Ohjets  en  plomb     

Objets  en  zinc     

O.I 
I.9 

O^ 

% 

I.I 
0-7 

O.I 

3-7 

0.4 

1.5 

11 

i-S 

O.I 
O.I 

1.4 
0.03 

O.I 

7-« 
4-5 
3-o 
0.04 
1.9 

i.i 
6.0 

0.04 

O.I 

18.4 
o-3 

12 

7-9 
3-7 
0.04 
0.04 

4-5 
3-4 
o. 
o. 
o. 
I. 
I. 
I. 

5-2 

4-5 

!-5 

O.I 
O.I 

45  -4 

i.i 

7-5 
3-7 
9-4 
i-9 

O.I 
O.I 

»-5 

4.9 

O.I 

0.04 

0.1 

I.I 

1.9 

i 

6.7 

Objets  en  pierre,  marbre  et  autres  min- 

Oh     -t 

Objets  en  paille,  en  ecorce,  etc  
Papiers,  jeux  de  cartes,  papier  de  ten- 

0.4 

0.4 
1.9 

0.7 
% 

Poudre  a  tirer  

Savons    .   .   .   

Boueies  et  chandelles  
Farines  et  produits  farineux     

O.I 
O.I 
O.I 

°-3 
0.3 
'•5 
4.9 
0.4 

o. 
o. 
o. 

0. 

30- 

!3- 

7- 

0.4 

,84.5 

O.I 
O.I 

4-9 

O.I 
2.2 
9-0 

8.6 
223.9 

Eau-de-vie     

Tabac  
Livres 

164.9 

3'5-2 

365.4 

698.9 

La  signature  recente  d'un  traite  de  commerce  et  de  navigation 
entre  la  France  et  la  Prusse,  traite  en  ce  moment  soumis  a  1'ex- 
amen  des  autres  Etats  de  1'association.  donne  un  interet  particu- 
lier  au  tableau  ci-apres,  relatif  a  nos  relations  commerciales  avec 
le  Zollverein.  II  a  et6  dresse  d'apres  les  documents  frat^ais  et 
indique  les  valeurs  actuelles  (en  millions  de  francs).  II  se  rap- 
porte  au  commerce  special. 


Annees. 

Importa- 
tions en 
France. 

Exporta- 
tions  de 
France. 

Annees. 

Importa- 
tions en 
France. 

Exporta- 
tions  de 
France. 

46  2 

!8^4         

54.6 

38.0 

lgr<       

ill:! 

S.S 

lS5O    .... 

36  2 

i8c6  

80.7 

iSzi 

,S  I 

,857     

l^2  

S.1 

\ 

18-8 

1068 

158 


SELECTIONS. 


Les  importations  du  Zollverein  en  France  portent  principale- 
ment  sur  des  matieres  premieres  de  1'indtistrie  (laines,  bestiaux, 
houille,  coke,  bois,  peaux  brutes,  poils).  Les  soieries  et  les 
lainages  y  figurent  cependant  pour  un  chiffre  assez  £lev6. 

Les  exportations  de  la  France  pour  le  Zollverein  ont,  au  con- 
traire,  pour  objets  principaux  des  produits  frabriques,  comme  les 
soieries,  les  lainages,  les  vetements  et  lingeries,  les  cotonnades  im- 
primees ;  les  peaux  ouvrees,  les  fils  de  laine,  les  outils  et  instru- 
ments, etc.  La  France  expedie  en  outre  dans  de  Zollverein, 
quand  la  recolte  est  bonne,  des  quantit^s  assez  considerables  de 
vins  ordinaires. 

S'il  fallait  juger,  d'apres  le  mouvement  de  la  navigation  dans 
les  ports  prussiens,  de  1' importance  relative  du  commerce  du 
Zollverein  avec  les  divers  Etats  europeens,  c'est  avec  1'Angleterre 
qu'il  eutretiendrait  le  mouvement  d'affaires  le  plus  considerable. 
Viendraient  ensuite,  par  ordre  d^croissant  de  trafic,  les  trois  ro- 
yaumes  scandinaves,  la  Hollande,  les  portes  ans£atiques,  la 
France,  la  Russie,  etc.  Mais  il  ne  faut  pas  perdre  de  vue  qu'en 
ce  qui  concerne  la  France,  la  plus  grande  partie  de  son  commerce 
avec  le  Zollverein  se  fait  par  la  voie  de  terre. 

Les  recettes  des  douanes  du  Zollverein  ont  oscil!6  ainsi  qu'il 
suit  de  1834  a  1859  (nombres  en  millions  de  francs). 


Annees. 

Importa- 
tion. 

Exporta- 
tion. 

Transit. 

Anndes. 

Importa- 

Exporta- 

Transit. 

1834  • 

52-i 

•5 

•9 

1847. 

100.9 

3-o 

.^ 

iS3S  • 
,836. 

59-6 
6S-6 

•9 

•9 

•9 
•9 

1848. 
1849. 

1:1 

•5 

.^ 

•9 

1837- 

637 

•5 

.2 

.850. 

86.2 

,i 

•9 

1838. 

72.4 

•9 

•9 

1851. 

87.0 

.1 

•5 

1839  . 

73-9 

•9 

.6 

1852. 

M.I 

.1 

•s 

1840. 

76.9 

•9 

.6 

>SS3- 

82.5, 

.1 

•9 

1841. 

80.2 

•5 

,2 

.854- 

86.3 

0.7 

•5 

1842. 
1843. 

8S-S 
92.6 

•5 
•5 

.2 

.a 

iSSS- 
1856. 

SI 

0.7 
0.7 

.2 

•5 

1844. 

96.0 

•9 

.6 

'857- 

99.0 

0.7 

1845. 

101.6 

•5 

•5 

1858. 

106.1 

0.7 

.5 

1846.   . 

99-S 

•9 

1859. 

88.  i 

0.7 

•5 

Les  faibles  oscillations  du  produit  des  douanes  depuis  1844 
constituent  le  trait  saillant  de  ce  tableau.  Toutefois,  cet  £tat  a 
peu  pres  stationnaire  des  recettes  ne  saurait  etre  interpr^te,  en 
presence  des  documents  qui  precedent,  comme  le  signe  d'un 
mouvement  d'affaires  peu  progressif.  II  ne  faut  pas  perdre  de 
vue,  d'ailleurs,  que  les  plus  grand  nombre  des  matieres  premieres 


LE   ZOLLVEREIN. 


159 


ont  ete,  en  1851  et  depuis,  ou  completement  affranchies  ou  con- 
siderablement  degrev^es.  Les  droits  de  transit  ont  egalement 
6t6  1'objet  d'importantes  reductions  jusqu'au  moment  de  leur 

suppression  en  1861 

En  1858  et  1859,  les  recettes  a  1'importation  (seulement),  ra- 
mene'es  a  100,000,  se  sont  reparties  ainsi  qu'il  suit  entre  les  Etats 
qui  precedent  (Francfort-sur-le-Mein  non  compris)  :  — 


1858. 

1859. 

n,iS8 

10062 

r*    Q/-* 

J'aSt 

Bade 

3  SoS 

2  460 

?;26s 

i  228 

Brunswick         .                    

g 

1 

1 

Voici  quelle  a  ^te  la  repartition  de  la  recette  nette  entre  les 
divers  Etats,  de  1857  a  1859  (valeurs  en  millions  de  francs)  :  — 


>8S7- 

1858. 

i8S9. 

Pour 

100. 

39  776  ^46 

B-iviere 

ti!ftatf  flfwi 

12  Si 

Ihmovre 

>  ss  > 

10  18 

Saxe  

Bade         .   .           .... 

Hesse  (Grand  Duch£)    
Hesse  (Electorate)     

2,'  H7»583 

2,370,881 

i»9$3,S5$ 

1,877,872 

3.40 

*    n^' 

Francfort-sur-le-Mein  
Brunswick      .               

'•ji?,iSS 

781,402 
691  882 

667,983 

0.85 

&%£ 

418  218 

S 

La    colonne   des  rapports  centesimaux  des  deux  tableaux   qui 
precedent,  appelle  tout  particulierement  1'attention  en  indiquant 


i6o 


SELECTIONS. 


les  Etats  qui  gagnent  ou  perdent  a  1'association.  Ainsi,  par  ex- 
emple,  la  Prusse,  qui  encaisse  58.82  p.  100  des  recettes  totales, 
ne  figure  que  pour  50.77  dans  la  repartition,  tandis  que,  pour  la 
Baviere,  ces  rapports  sont  respectivement  de  5.15  a  le  recette  et  de 
12.84  *  ^a  ^partition.  En  resume,  les  Etats  gagnants  sont  les 
suivants :  Baviere,  Hanovre,  Wurtemberg,  les  deux  Hesses,  la 
Thuringe,  Oldenbourg  et  Nassau.  La  Prusse,  le  Luxembourg, 
la  Saxe,  Bade,  Brunswick  et  Francfort-sur-le-Mein  composent  la 
serie  des  perdants.  Les  parts  du  Zollverein  sont  ceux  de  la 
Prusse,  du  duche  d'Oldenbourg  et  du  Hanovre.  Les  documents 
qui  suivent  indiquent  le  mouvement  de  la  navigation  de  ces  ports 
de  1856  a  1859  (grand  et  petit  cabotage  non  compris). 

PORTS   PRUSSIENS. 


ANNEES. 

BATIMENTS. 

TONNKAUX.l 

BATIMENTS 

SUR   LEST.2 

TONNEAUX. 

Entrds. 

Sortis. 

Entres. 

Sortis. 

Entrds. 

2,668 
2,59Q 
3,052 
I,994 

Sortis. 

i,743 
i,939 
1,229 

2,111 

Entres. 

Sortis. 

.S59  
iS5S  

Q,»<5 

8,922 
8.533 
7.S82 

9.  '97 
9.032 

?$ 

i,47i,S22 
1,401.560 
1,584,622 
',337,746 

1,414,602 
1,469,582 
1,564,384 
1,374,416 

452,846 
433.78S 
561,130 
381,850 

319,458 
401,614 
254,432 
380,310 

'856  

Dans  le  duche  d'Oldenbourg,  la  navigation  a  etc  en  1859:  a 
1'entree,  de  933  navires  charges,  jaugeant  78,484  lasts  et  de  n  sur 
lest,  jaugeant  879  lasts  ;  a  la  sortie,  de  311  navires  charges,  jaug- 
eant 38,295  lasts  et  de  502  sur  lest  avec  37,821  lasts. 


PORTS   HANOVRIENS. 


1859  .   .       ,  .  1  =nt*    

NAVIRES  CHARGES. 

NAVIRES  SUR  LEST. 

Nombre.      ' 

Lasts. 

Nombre. 

Lasts. 

1,141 
1,092 

3,016 
1,104 

36,850 
29,270 

112,031 
36,459 

592 
2,470 

21,664 
32,964 

21,858 
100,281 

I858  j  Sortie    

Les  avantages  purement  materiels  du  Zollverein  pour  les  Etats 


*  *  Le  tonneau  de  mer  prussien  =  ooSk.So. 
*  Compris  dans  les  totaux  precedents. 


LE   ZOLLVEREIN.  l6l 

interessees  peuvent  se  resumer  ainsi  qu'il  suit :  1°  reduction  des 
frais  de  perception  et  d'administration,  par  suite  de  la  suppression 
des  rayons  de  douanes  entre  les  Etats  associes  ;  2°  rapide  develop- 
pement  industriel,  par  suite  de  1'application  d'un  tarif  modere-; 
3°  elevation  du  chifFre  primitif  des  recettes  de  douane,  par  suite  de 
1'accroissement  de  consommation  resultant  de  1'application  de  ce 
tarif;  4°  conclusion  de  traites  de  commerce  avantageux  avec 
1'etranger,  plus  dispose  a  faire  des  concessions  a  un  fitat  qui  lui 
oftre  un  debouche  considerable  qu'a  des  pays  sans  importance  ;  5° 
usage  gratuit  ou  a  des  conditions  tres  moderees  des  grandes  voies 
de  communication  terrestres,  fluviales  ou  maritimes,  qui  n'exis- 
taient  auparavant  qu'au  profit  d'un  ou  de  quelques-uns  d'entre 
eux  ;  6°  rapide  essor  de  certaines  industries  indigenes,  auxquelles 
la  libre  ouverture  d'un  marche  interieur  de  33  millions  d'habitants,1 
ainsi  que  1'usage  en  franchise  de  matieres  premieres  fournies  par 
1'un  ou  1'autre  des  Etats  assocre's  et  autrefois  frappees  de  droits  de 
douane,  permettent  de  produire  plus  economiquement ;  7°  crea- 
tion d'une  forte  marine  marchande. 

L'institution  du  Zollverein  a  eu  des  avantages  correspondants 
pour  le  commerce  Stranger.  Au  lieu  d'avoir  a  traveller  40 
lignes  douanieres,  defendues  par  des  droits  plus  ou  moins  com- 
pliques,  plus  ou  moins  eleves,  et  appliques  par  des  adminis- 
trations plus  ou  moins  tracassieres,  il  s'est  trouve  en  face  d'un  pays 
unique,  recevant  ses  produits  a  des  conditions  relativement  mod- 
erees. Au  lieu  d'avoir  a  traiter  avec  des  consommateurs  peu 
aises,  restreignant  leurs  depenses  au  plus  strict  necessaire  il  a 
profile  du  developpement  de  la  richesse  publique  dans  le  Zoll- 
verein devenu,  apres  quelques  annees,  un  grand  pays,  non-seule- 
ment  par  le  territoire  et  la  population,  mais  encore  par  le  bien- 
etre  croissant  de  sa  population. 

Le  Zollverein  n'est  cependant  pas,  dans  son  organisation  et  ses 
resultats  actuels,  la  formule  la  plus  complete,  la  plus  heureuse  du 
principe  de  1'association  commerciale.  Le  mode  complique  de 
ses  deliberations;2  la  difficulte,  pour  ses  membres,  d'arriver,  sur 
les  questions  les  plus  graves,  a  une  solution  favorable  aux  interets 
souvent  tres-opposes  qu'ils  representent ;  les  influences  politiques 
qui  s'agitent  dans  son  sein  et  1'empechent  de  discerner  toujours 

1  D'apres  le  denombrement  de  1861  dont  les  resultats  officiels  nous  arrivent  en  ce  moment, 
de  34,705,694  habitants. 

2  On   salt  que  toutes  les  deliberations  du   Zollverein,  pour  etre  valables,  doivent  etre 
prises  a  1'unanimite.    Ainsi,  dansces  deliberations,   la  Prusse  ne  pese  pas  d'un  plus  grand 
poids  que  Francfort-sur-le  Mein  avec  ses  So,ooo  habitants !  ..  .  . 


1 62  SELECTIONS. 

clairement  la  voie  a  suivre  pour  tirer  de  1'union  les  resultats 
e"conomiques  les  plus  considerables,  telles  sont  les  justes  critiques 
dont  il  a  souvent  e"te"  1'objet.  On  pent  encore  lui  reprocher  de 
maintenir,  malgre"  1'exemple  de  1'Angleterre  et  de  la  France,  des 
droits  qui,  pour  certains  produits  fabriques,  depassent  tres-sensi- 
blement,  par  le  fait  de  la  diminution  considerable,  dcpuis  la 
formation  du  Zollverein,  du  prix  des  produits  greves,  cette 
moyenne  de  10  p.  100  de  la  valeur,  destined,  d'apres  le  pro- 
gramme de  1'association,  a  son  debut  a  devenir  la  basede  son  tarif. 
Cette  protection  exageree  est  une  double  faute,  d'abord  parce  que 
les  consommateurs  de  1'association,  moins  aise's  que  ceux  des 
deux  pays  que  nous  venons  de  citer,  sont  moins  en  etat  de  paver 
des  prix  Sieve's ;  puis,  parce  que  le  Zollverein,  par  les  perfec- 
tionnements  introduits  dans  ses  precedes  de  fabrication  et  le  bas 
prix  de  la  main-d'oeuvre,  est  aujourd'hui  tout  a  fait  en  mesure  de 
lutter  efficacement  centre  la  concurrence  etrangere.  1862. 


THE   CORN   LAWS.  163 


IX. 

THE   CORN    LAWS. 

FROM  LEVI'S  HISTORY  OF   BRITISH  COMMERCE,  2D  ED. 
PART  III.  —  CHAP.  8. 

THE  corn  laws  had  long  been  a  bone  of  contention  in  England. 
Maintained  for  the  interest  of  a  class  who  clung  to  them  as  their 
anchor  of  safety,  they  had  always  been  attacked  as  an  obstacle  to 
the  well-being  of  the  middle  and  lower  classes.  In  the  opinion  of 
their  advocates,  protection  was  necessary  in  order  to  keep  certain 
poor  lands  in  cultivation,  and  to  encourage  the  cultivation  of  as 
much  land  as  possible  in  order  to  provide  for  the  wants  of  the 
country.  Let  the  cultivation  of  such  lands  cease,  thev  said,  and 
we  shall  be  dependent  on  foreigners  for  a  large  portion  of  the 
people's  food.  Such  dependence,  moreover,  may  be  fraught  with 
immense  danger,  inasmuch  as,  in  the  event  of  war,  the  supplies 
may  be  stopped  or  our  ports  may  be  blockaded,  the  result  of 
which  may  be  famine,  disease,  or  civil  war.  According  to  the 
defenders  of  protection  it  was  the  advantage  gained  by  the  corn 
laws  that  enabled  landed  proprietors  and  their  tenants  to  en- 
courage manufactures  and  trade.  Abolish  the  corn  laws  and 
half  the  country  shopkeepers  will  be  ruined,  mills  and  factories 
will  be  stopped,  large  numbers  of  the  working-classes  will  be 
thrown  out  of  work,  disturbances  will  ensue,  capital  will  be  with- 
drawn, and  no  one  dare  venture  to  say  what  may  be  the  fatal  con- 
sequences. 

In  1801  the  price  of  wheat  reached  the  high  limit  of  1555. 
a  quarter,  and  we  may  well  imagine  what  sufferings  that  price 
entailed  among  the  people,  at  a  time  especially  when  trade  and 
manufacture  were  so  much  paralysed  by  the  Continental  war. 
Happilv,  for  two  or  three  years  afterwards,  a  succession  of  good 
harvests  changed  the  condition  of  things,  and  in  March,  1804,  the 
price  of  wheat  fell  to  495.  6d.  per  imperial  quarter.  But 
what  was  anxiously  desired  by  the  people  was  regarded  a 
great  disaster  by  the  agricultural  interest.  They  complained  that 
with  the  high  cost  of  production,  in  consequence  of  high  wages, 


164  SELECTIONS. 

high  rate  of  interest,  and  the  heavy  cost  of  implements  of  hus- 
bandry, they  could  not  afford  to  sell  at  such  prices.  Meetings 
were  held  throughout  the  country  to  consider  the  case  of  the 
farmers.  Mr.  Western  brought  the  state  of  agriculture  before 
the  House  of  Commons,  and  a  committee  was  appointed  on 
the  subject.  The  farmers  contended  that  at  a  time  when  all 
foreign  supplies  were  shut  out  from  our  markets,  and  when  we 
were  more  than  ever  depending  on  home  production,  it  was  the 
bounden  duty  of  the  legislature  to  pass  laws  which  would  encour- 
age the  production  of  grain  at  home,  so  that  the  nation  might  be 
as  much  as  possible  independent  as  regards  the  first  necessaries  of 
life.  Unfortunately  all  the  measures  hitherto  taken  for  the  protec- 
tion of  the  farmers  resulted  only  in  the  aggravation  of  the  sufferings 
of  the  people.  It  was  easy  by  means  of  prohibitions  and  bounties 
to  raise  the  price  of  corn  and  to  give  an  artificial  stimulus  to  agri- 
cultural prosperity,  but  the  people  were  not  able  to  buy  bread  at 
famine  prices,  especially  at  a  time  when  taxes  were  so  heavy.  The 
report  of  the  committee  of  the  House  of  Commons,  presented  the 
same  session  in  1804,  was  to  the  effect  that  the  price  of  corn  from 
1791  to  the  harvest  of  1803  had  been  very  irregular,  but  that  upon 
an  average  it  had  increased  in  a  great  degree  in  consequence  of 
the  years  of  scarcity,  and  had  in  general  yielded  a  fair  profit  to 
the  grower.  It  appeared  to  the  committee,  moreover,  that  high 
prices  had  the  effect  of  stimulating  agricultural  industry  in  bring- 
ing into  cultivation  large  tracts  of  waste  lands,  and  that  this  fact 
combined  with  the  abundance  of  the  two  last  productive  seasons,, 
and  other  causes,  occasioned  such  a  depression  in  the  value  of 
grain  as  would  tend  to  the  discouragement  of  agriculture,  unless 
maintained  by  the  support  of  Parliament.  Nor  was  there  much 
difficulty  in  persuading  the  legislature  to  give  heed  to  such 
recommendations.  Very  soon  after  the  presentation  of  the 
report  a  corn  law  was  passed,1  which  imposed  a  duty  of  245.  3d. 
per  quarter  on  wheat  so  long  as  the  price  of  the  home  market 
should  be  under  635.  ;  of  2s.  6d.  so  long  as  the  price  should  be 
at  or  above  that  rate,  and  under  66s.  ;  and  of  6d.  a  quarter  when 
the  price  should  be  above  that  rate.  It  does  not  appear,  how- 
ever, that  the  fear  entertained  by  the  farmers  and  the  agricultural 
interest  had  been  very  substantial,  for  in  the  same  year  the  harvest 
was  deficient  in  quantity  and  inferior  in  quality,  and  all  appre- 

>44Geo.  III.c.  109. 


THE   CORN   LAWS.  165 

hensions  that  bread  might  become  too  cheap  were  entirely  out  of 
the  question.  A  proposal,  indeed,  was  made  to  encourage  the 
growth  of  corn  in  Great  Britain,  and  vet  to  diminish  the  price 
thereof  for  the  benefit  of  the  people  by  exempting  farmers  from 
all  direct  taxes.  But  such  a  plan  would  have  only  transferred 
the  burden  from  one  class  to  another.  The  time  had  not  yet 
arrived  for  acting  on  the  "laissez-faire"  principle.  Artificial  aid 
was  sought  for  on  all  sides,  and  that  always  ended  in  disappoint- 
ment. 

At  the  conclusion  of  the  French  war,  in  1815,  precisely  the 
same  state  of  matters  arose  as  in  1804.  By  the  opening  of  the 
ports,  wheat  which  hitherto  averaged  5!.  IDS.  a  quarter  suddenly 
fell  to  3!.  55  ,  and  immediately  the  farmers  raised  a  cry  of  dis- 
tress. Again  a  committee  of  the  House  of  Commons  was  ap- 
pointed to  inquire  into  the  state  of  the  law  affecting  the  corn 
trade,  and  once  more  the  legislature  was  engaged  in  framing  a 
corn  law,1  which  resulted  in  an  act  prohibiting  the  importation 
of  wheat  when  the  price  was  under  8os.,  and  rendering  it  free 
when  above  8os.  Yet,  serious  misgivings  existed  as  to  the 
ultimate  effect  of  the  restrictive  legislation  respecting  corn  in 
the  minds  of  many,  and  in  the  very  House  of  Lords,  which 
traditionally  stood  in  bold  defence  of  a  protective  policy,  pro- 
tests were  lodged,  which  indicated  the  existence  of  a  more 
enlightened  opinion  on  the  real  bearings  of  the  whole  question. 
Lord  Grenville  and  his  compeers  protested  against  this  new 
corn  law,  because  they  were  adverse  in  principle  to  all  new 
restraints  in  commerce,  deeming  it  most  advantageous  to  public 
prosperity  to  leave  uncontrolled  the  free  current  of  national  in- 
dustry. In  their  opinion  "  the  great  practical  rule  of  leaving 
all  commerce  unfettered,  applied  more  peculiarly,  and  on  still 
stronger  grounds  of  justice  as  well  as  of  policy,  to  the  corn  trade 
than  to  any  other.  Irresistible,  indeed,  must  be  that  necessity 
which  could,  in  their  judgment,  authorize  the  legislature  to  tamper 
with  the  sustenance  of  the  people,  and  to  impede  the  free  purchase 
and  sale  of  that  article,  on  which  depends  the  existence  of  so  large 
a  portion  of  the  community.  They  thought  that  expectations  of 
ultimate  benefit  from  any  corn  law  were  founded  on  a  delusive 
theory.  They  could  not  persuade  themselves  that  such  a  law 
would  ever  contribute  to  produce  plenty,  cheapness,  or  steadiness 

iSSGeo.  III.  c.  z6. 


1 66  SELECTIONS. 

of  price.  So  long  as  it  operated  at  all,  its  effects  must  be  the 
opposite  of  these.  Monopoly  is  the  parent  of  scarcity,  dearness, 
and  uncertainty.  To  cut  off  any  of  the  sources  of  supply  can  only 
tend  to  lessen  its  abundance.  To  close  against  ourselves  the 
cheapest  market  for  any  commodity,  must  enhance  the  price  at 
which  we  purchase  it.  And  to  confine  the  consumer  of  corn  to 
the  produce  of  his  own  country,  is  to  refuse  ourselves  the  benefit 
of  that  provision  which  Providence  itself  has  made  for  equalizing 
to  man  the  variations  of  climate  and  of  seasons.  But,  whatever 
might  be  the  future  consequences  of  that  law,  at  some  distant  and 
uncertain  period  they  were  convinced  that  these  hopes  must  be 
purchased  at  the  expense  of  a  great  and  present  evil.  To  compel 
the  consumer  to  purchase  corn  dearer  at  home  than  it  might  be 
imported  from  abroad  was  the  immediate  practical  effect  of  the 
law  just  passed.  In  this  way  alone  could  it  operate.  Its  present 
protection,  its  promised  extension  of  agriculture  must  result  (if 
at  all)  from  the  profits  which  it  created  by  keeping  up  the  price 
of  corn  to  an  artificial  level.  These  future  benefits  were  the 
consequences  expected,  though  they  confidently  believed  errone- 
ously expected,  from  giving  a  bounty  to  the  grower  of  corn  by  a 
tax  levied  on  its  consumers."  Such  were  the  reasons  urged 
against  the  corn  law  of  1815,  and  certainly  they  do  honor  to  those 
who  recorded  them  in  the  journal  of  the  House.  But  many  a  year 
was  to  pass  ere  the  protests  of  the  few  did  become  the  deliberate 
conviction  of  the  entire  community. 

For  twelve  years  nothing  further  occui'red  on  the  subject  of 
the  corn  laws,  except  the  emission  of  repeated  cries  of  distress  by 
the  agricultural  classes,  especially  in  the  House  of  Lords.  The 
country  was  indeed  learning  by  bitter  experience  how  direct  is  the 
relation  between  dear  bi'ead  and  bad  trade,  and  the  time  arrived 
when  the  working  of  the  corn  law  was  to  be  laid  before  the  legisla- 
ture. "  The  corn  laws,"  said  Mr.  Whitmore,  "  have  inflicted  the 
greatest  injury  upon  the  general  trade  of  the  world  that  ever,  per- 
haps, was  produced  by  injudicious  legislation.  They  have  de- 
ranged its  course,  stagnated  its  current,  and  caused  it  to  flow  in 
new  and  far  less  beneficial  channels  than  it  formerly  occupied. 
To  the  corn  laws  he  attributed  the  great  and  ruinous  fluctuation 
of  prices,  which  is  the  inevitable  result  of  a  system  of  restriction. 
The  more  the  basis  from  whence  your  supplies  are  drawn  is 
widened,  the  greater  the  steadiness  of  prices  ;  the  more  it  is  nar- 
rowed, the  more  constant  and  the  more  fatal  is  their  effect  on  the 


THE   CORN   LAWS.  l6/ 

fluctuations  to  which  you  are  subject.  In  the  early  times,  when 
there  was  a  difficulty  in  the  conveyance  of  bulky  commodities 
from  one  part  of  the  country  to  another,  arising  from  want  of 
roads,  when  there  existed  a  prejudice  as  well  as  a  legal  penalty 
against  what  was  called  forestalling  and  regrating,  the  fluctuations 
in  prices  were  immense.  And  the  same  holds  good  as  regards 
other  times  and  other  countries."  Lord  Lauderdale  himself,  while 
entertaining  considerable  fear  of  foreign  competition,  clearly 
showed  what  are  the  solid  and  what  are  the  fictitious  ways  to 
agricultural  prosperity.  "  I  will  take  upon  myself,"  he  said,  "  to 
assert,  that,  if  there  is  any  one  proposition  in  political  economy 
which  may  be  affirmed,  it  is  this,  that  the  interests  of  landlords 
properly  understood  are  absolutely  identified  with  the  general  in- 
terests of  the  country.  Landlords  have  no  interest  in  high  prices  ; 
high  prices  raise  rents  nominally  and  in  appearance  ;  and  now 
and  then,  some  temporary  advantage  maybe  obtained  from  them, 
for  which  landlords  will  always  pay  afterwards  with  more  than 
compound  interest ;  but  rents  can  only  be  raised  largely,  perma- 
nently, and  beneficially  to  landlords  by  one  of  two  causes,  both 
of  which  are  equally  conducive  to  the  prosperity  of  all  other 
classes ;  first,  by  improvements  in  agriculture,  which  leave  a 
larger  surplus  produce  after  the  expenses  of  cultivation  are  de- 
frayed ;  and,  secondly,  by  improved  and  extended  markets.  Now, 
all  improvements  of  agriculture  which  increase  the  surplus  pro- 
duce of  the  country  are  obviously  a  direct  addition  to  the  public 
wealth.  And  how  are  markets  improved  and  extended?  By 
new  communication,  —  roads,  railways,  canals,  —  but  principally 
by  the  continual  rise  and  increase  of  large  towns  within  our  own 
empire,  rendered  rich  and  prosperous  by  thriving  manufactures, 
and  by  all  the  improvements  in  skill  and  machinery  connected 
with  such  establishments.  The  best  job  for  the  landlord  is  the 
prosperity  of  trade  in  all  its  branches,  as  the  best  job  for  trade  is 
a  prosperous  state  of  agriculture.  There  is  nothing  to  make 
the  inhabitant  of  the  town  and  the  cultivator  of  the  soil  jealous 
of  each  other  ;  quite  the  contrary,  for  the  more  each  produces,  the 
more  he  will  have  to  exchange  for  the  other ;  and  this  is  the 
foundation  of  the  great  internal  trade  which  is  worth  one  hun- 
dred times  more  than  all  the  foreign  commerce  of  the  country- 
put  together." 

Yet,  notwithstanding  the  enunciation  of  these  truths,  the  farm- 
ers clung  tenaciously  to  protection  ;    and   it  was  not  without  a 


1 68  SELECTIONS. 

great  struggle  that  they  allowed  the  corn  laws  to  be  relaxed  to 
a  small  extent.  In  the  session  of  1827  resolutions  were  passed  in 
the  House  of  Commons,  to  the  effect  that  corn  should  be  allowed 
to  be  imported  free  of  duty,  in  order  to  be  warehoused,  and  that 
it  should  be  admissible  for  home  consumption  at  a  shilling  per 
quarter  duty  when  the  price  of  wheat  should  be  yos.,  and  at  two 
shillings  more  for  every  shilling  that  the  price  fell  below  703. 
per  quarter.  These  resolutions,  however,  made  no  progress,  in 
consequence  of  the  change  of  government.  The  following  ses- 
sion the  House  of  Commons  passed  other  resolutions,  to  the  effect 
of  imposing  a  sliding  scale  from  233.  per  quarter  when  the  price 
of  wheat  should  be  645.,  and  i6s.  8d.  when  the  price  should 
be  695.,  to  one  shilling  per  quarter  when  the  price  should  be  at 
and  above  735.  per  quarter.  And  upon  these  bases  a  new  corn 
law  was  passed,1  which,  like  its  predecessors,  did  not  long  remain 
in  force. 

It  was  ten  years  after  the  passing  of  this  first  sliding  scale,  or 
on  March  15,  1838,  that  Mr.  Villiers.  seconded  by  Sir  William 
Molesworth,  first  commenced  his  attack  on  the  policy  of  the  corn 
laws  in  the  House  of  Commons,  though  with  little  effect.  In 
those  days  political  economists  were  simply  allowed  to  speak  and 
complain.  Their  opinions  were  received  as  mere  speculative 
theories,  their  recommendations  were  deemed  as  far  beyond  the 
reach  of  practical  statesmanship.  There  was  only  one  minister 
present  when  Mr.  Villiers'  motion  was  made,  and,  as  might  have 
been  expected,  it  was  lost  by  an  overwhelming  majority.  But 
about  that  time  a  lecture  was  advertised  to  be  delivered  at  Bolton, 
the  birthplace  of  Arkwright  and  Crompton,  on  the  corn  laws,  by 
a  person  quite  a  stranger  to  the  town.  It  was  a  new  subject  for  a 
lecture,  and,  as  the  public  mind  was  directed  to  the  question,  the 
lecture  drew  a  fair  number  of  hearers.  The  lecturer,  however, 
found,  only  when  it  was  too  late,  that  it  was  not  easy  to  deal  with 
economic  questions  before  a  mixed  audience,  and  he  completely 
broke  down.  The  audience,  not  prepared  for  the  disappointment, 
became  impatient  and  vociferous,  and  a  riot  was  impending,  when 
a  youth,  a  medical  student,  rushed  to  the  platform,  and  on  the  spur 
of  the  moment  addressed  the  people  on  the  subject  in  a  vigorous 
and  manly  manner.  The  people  were  delighted  at  this  turn,  and 
Mr.  Paulton  won  for  himself  enthusiastic  admiration.  On  the 

i9Geo.IV.c.38. 


THE   CORN   LAWS.  169 

news  of  such  an  event  travelling  to  the  neighboring  towns,  the 
volunteer  lecturer  was  overwhelmed  with  invitations  to  redeliver 
his  address,  and  everywhere  he  captivated  the  audience  with  his 
eloquent  attacks  on  monopoly  and  monopolists. 

As  the  interest  in  the  question  of  the  corn  laws  grew  and  extended, 
it  became  evident  that  a  special  and  more  popular  agency  was 
wanted  for  the  purpose,  and  thus,  in  October  of  1838,  eight1  men 
first  united  themselves  with  a  view  to  establish  an  Anti-Corn  Law 
Association.  The  list  of  the  provisional  committee  was  after- 
wards increased  to  thirty-seven,  conspicuous  among  them  being 
John  Bright,  George  Wilson,  and  Richard  Cobden.  And  the 
object  of  the  association  was  declared  to  be  to  form  a  fund  in 
order  to  diffuse  information,  by  lectures  or  pamphlets,  on  the 
bearing  of  the  corn  laws,  to  defray  the  expense  of  petitioning, 
and,  above  all,  to  create  an  organization  to  bring  numbers  to- 
gether in  such  force  and  with  such  energy  of  purpose,  as  to  se- 
cure the  great  object,  viz.,  the  complete  freedom  of  trade,  by  the 
destruction,  not  only  of  the  corn  monopoly,  but  of  all  the  other 
monopolies  bolstered  up  by  this  monster  grievance.  Small  was 
the  support  at  first  obtained  by  this  new  association.  Very 
few  then  appreciated  its  great  moral  importance.  "  For  the 
first  two  or  three  years  of  our  agitation,"  said  Mr.  Cobden, 
"it  was  a  very  hopeless  matter,  and  there  was  no  eclat  nor 
applause.  .  .  .  We  sat  in  a  small  room,  and  we  had  a  dingy  red 
curtain  drawn  across  the  room  that  we  might  not  be  chilled  by 
the  paucity  of  our  numbers.  Two  or  three  were  all  that  were 
here  (Newall's  Buildings)  on  one  occasion,  and  I  recollect  saying 
to  my  friend  Prentice,  '  What  a  lucky  thing  it  is  the  monopolists 
cannot  draw  aside  that  curtain  and  see  how  many  of  us  there  are, 
for,  if  they  could,  they  would  not  be  much  frightened.'  "  It  was 
not  long,  however,  ere  the  small  association  began  to  manifest  its 
power  and  influence,  and  when,  aided  by  the  powerful  support 
of  some,  at  least,  of  the  leading  journals,  its  voice  resounded 
through  the  length  and  breadth  of  the  land.  Meetings  and  con- 
ferences then  succeeded  each  other.  From  the  manufacturing  dis- 
tricts the  movement  spread  to  the  metropolis,  and  with  a  clearly 
defined  purpose  in  view,  and  with  the  highest  economic  author- 
ities to  appeal  to  in  support  of  their  principles,  the  Anti-Corn 

1  The  original  founders  of  the  League  were  John  Benjamin  Smith,  Archibald  Prentice, 
Richard  Cobden,  Thomas  Bazley,  William  Rawson,  W.  R.  Callender,  Henry  and  Edmund 
Ashworth.  (See  Cobden  and  the  League,  by  Henry  Ashworth,  Esq.) 


1 70  SELECTIONS. 

Law  agitators  made  everywhere  a  profound  and  lasting  impres- 
sion. 

On  March  12,  1839,  Mr.  Villiers  again  brought  the  subject  of 
the  corn  laws  before  the  House  of  Commons,  now,  however, 
backed  by  a  strong  party  both  inside  and  outside  the  House. 
His  motion  was,  "  That  this  House  resolve  itself  into  a  com- 
mittee of  the  whole  House,  to  take  into  consideration  the  act  9 
George  IV.,  regulating  the  importation  of  foreign  grain."  Mr. 
Villiers  showed  that  the  corn  laws  were  not  beneficial  to  the 
agricultural  interest,  and  that  neither  the  agricultural  laborer  nor 
the  farmers  reaped  from  them  any  benefit.  He  asserted  that 
the  community  at  large  suffered  a  loss  through  the  corn  laws, 
equal  to  a  poll  tax  of  8s.  a  head,  or  a  tax  of  £2  on  each  family 
in  the  kingdom,  and  he  demonstrated  that  commerce  and  shipping 
were  greatly  injured  by  them.  Mr.  Villiers'  motion  was  seconded 
by  Sir  George  .Strickland,  and  on  his  side  spoke  Mr.  Potilett 
Thomson,  Sir  William  Molesworth,  Mr.  Grote,  Mr.  Clay,  Lord 
Howich,  Sir  Henry  Parnell,  Mr.  Ward,  Lord  John  Russell,  Mr. 
Hume,  Mr.  Fielden,  and  Mr.  O'Connell ;  whilst  against  him 
were  Sir  James  Graham,  Sir  Robert  Peel,  and  a  host  of  Con- 
servatives. The  discussion  was  animated  and  well  sustained, 
and  after  five  whole  nights'  debate  the  votes  were  taken  and  the 
motion  was  lost  by  195  to  342.  In  the  House  of  Lords,  too,  a 
discussion  was  commenced  on  the  subject.  On  March  14  the 
Earl  of  Fitzwilliam  moved,  "  That  the  act  9  George  IV.  c.  60, 
entitled  '  An  Act  to  amend  the  law  relating  to  the  importation  of 
corn,'  has  failed  to  secure  that  steadiness  in  the  price  of  grain 
which  is  essential  to  the  best  interests  of  the  country ; "  but  the 
motion  was  lost  by  24  against  224.  A  day  after  Lord  Brougham 
moved,  "  That  this  House  do  immediately  resolve  itself  into  a 
committee  of  the  whole  House,  to  take  into  consideration  the 
importation  of  foreign  corn."  But  the  motion  met  a  similar  fate, 
only  7  having  voted  for  it,  and  61  against  it.  Slow  is  the  pro- 
gress of  any  measure  in  the  House  of  Commons  when  any  sub- 
stantial reform  is  contemplated,  but  slower  still  is  its  advance  in 
the  House  of  Lords.  Coming  less  in  contact  with  the  mass  of 
the  people,  comparatively  strangers  to  their  feelings  and  wants, 
conservative  by  interest  and  hereditary  policy,  the  peers  of  the 
realm  are  necessarily  the  last  to  admit  the  need  of  change,  and 
the  last  to  make  concessions  to  the  altered  exigencies  of  the  times. 
Nevertheless,  there  have  never  been  wanting  enlightened  members 


THE   CORN   LAWS.  1 71 

in  the  upper  House  who  sought  the  maintenance  and  preservation 
of  their  order  from  that  same  law  of  progress  on  which  all  the 
institutions  of  the  realm  depend,  and  who,  far  from  regarding 
their  interests  as  antagonistic  to  those  of  other  classes  of  society, 
had  the  wisdom  to  discern  that  we  are  all  subject  to  the  same 
laws,  influenced  by  the  same  circumstances,  and  alike  bound  to 
obe}'  those  laws  of  nature,  which,  more  than  any  human  contriv- 
ance, determine  the  progress  and  prosperity  of  states. 

The  result  of  Mr.  Villiers'  motion  in  the  House  of  Commons  was 
not  likely  to  discourage  the  Anti-Corn  Law  Association.  On  the 
contrary,  it  imparted  to  it  a  new  life  and  a  fresh  impulse.  Deter- 
mined to  persevere  till  the  end,  the  agitators  saw  in  the  strength 
of  their  opponents  only  an  additional  cause  for  more  energetic 
labors.  A  meeting  was  accordingly  organized  in  London,  and 
the  same  voice  which  first  gave  strength  and  vivacity  to  the  Man- 
chester gathering,  was  now  heard  exclaiming,  "  We  are  the  rep- 
resentatives of  three  millions  of  people,  — a  far  greater  number  of 
constituents  than  the  House  ever  could  boast  of.  We  well  know 
that  no  great  principle  was  ever  indebted  to  Parliament  for  suc- 
cess ;  the  victory  must  be  gained  out  of  doors.  The  great  towns 
of  Britain  have  extended  the  right  hand  of  fellowship  to  each 
other,  and  their  alliance  will  be  a  Hanseatic  league  against  the 
feudal  corn-law  plunderers."  The  Anti-Corn  Law  League  was 
never  a  political  organization.  For  years  its  members  went  on 
lecturing,  distributing  tracts,  and  acting  as  a  peripatetic  university 
in  instructing  the  people  on  the  evil  of  commercial  monopoly. 
Never  did  it  allow  itself  to  be  tempted  to  other  political  topics. 
The  League  did  not  even  wish  to  interfere  with  the  system  of 
taxation,  further  than  extinguishing,  at  once  and  forever,  the 
principle  of  maintaining  taxes  for  the  benefit  of  a  particular  class. 
"If  it  be  asked,"  said  Mr.  Cobden,  "  why  it  is  that  we,  pro- 
fessing to  be  free-traders  in  everything,  should  restrict  the  title  of 
our  association  to  that  of  the  '  National  Anti-Corn  Law  League,' 
I  will  explain  the  reason.  We  advocate  the  abolition  of  the  corn 
law  because  we  believe  that  to  be  the  foster-parent  of  all  other 
monopolies  ;  and  if  we  destroy  that,  — » the  parent,  the  monster 
monopoly,  —  it  will  save  us  the  trouble  of  destroying  all  the 
rest." 


SELECTIONS. 


PART  IV.  — CHAP.  i. 

The  day  arrived  when  the  government  of  the  country  had  to  be 
confided  to  the  great  Conservative  party  in  the  House.  For  some 
time  past  the  administration  of  Lord  Melbourne  had  shown  unmis- 
takable signs  of  inherent  weakness,  and  its  opponents,  counting 
among  them  such  men  as  Sir  Robert  Peel,  Lord  Stanley,  Mr. 
Gladstone,  and  Mr.  Disraeli,  were  decidedly  gaining  strength  and 
influence.  The  Conservative  party  has  been  charged  with  thwart- 
ing and  opposing  the  liberal  tendencies  of  the  nation,  and  they 
certainly  resisted  the  passing  of  the  Reform  Bill,  the  repeal  of 
the  Test  and  Corporation  Acts,  and  the  Emancipation  of  Roman 
Catholics.  Yet  a  memorable  Conservative  administration  is  be- 
fore us,  which  inaugurated  an  era  of  great  prosperity,  and  one 
which,  under  the  presiding  genius  of  Sir  Robert  Peel,  has  ever 
since  been  held  in  grateful  remembrance  for  the  practical  wisdom 
which  it  displayed,  and  the  bold  and  vigorous  commercial  and 
financial  policy  it  carried  into  effect.  Sir  Robert  Peel  had  already 
gained  for  himself  a  high  reputation  as  a  statesman.1  As  a  mem- 
ber of  the  Bullion  Committee  of  1810,  as  under-secretary  for  the 
colonies  during  the  most  trying  years  of  the  Continental  War,  as 
secretary  for  Ireland,  in  all  these  capacities  he  proved  himself  an 
able  minister  and  an  economist  of  much  practical  wisdom  ;  and  it 
was  a  good  omen  for  the  country  when,  in  September,  1841,  at  a 
time  of  much  financial  anxiety,  Sir  Robert  Peel  was  called  to 
take  the  helm  of  the  State. 

There  was  something  novel  and  encouraging  in  the  speech 
from  the  throne  which  opened  the  labors  of  the  new  adminis- 
tration. "  Her  Majesty  is  anxious  that  this  object,  viz.,  the  in- 
crease of  the  public  revenue,  should  be  effected  in  the  manner 
least  burdensome  to  her  people  ;  and  it  has  appeared  to  Her 
Majesty,  after  full  deliberation,  that  you  may,  at  this  juncture, 
properly  direct  your  attention  to  the  revision  of  duties  affecting 
productions  of  foreign  countries.  It  will  be  for  you  to  consider, 
whether  some  of  the  duties  are  not  so  trifling  in  amount  as  to  be 
unproductive  to  the  revenue,  while  they  are  vexatious  to  com- 

1  Sir  Robert  Peel's  first  administration  was  a  short  one.  He  formed  his  Cabinet  on  De- 
cember  9,  1834,  and  forthwith  dissolved  Parliament.  A  new  Parliament  was  summoned  to 
meet  on  February  19,  1835,  but  an  amendment  to  the  address  was  carried  in  the  House  of 
Commons  on  February  26,  by  a  majority  of  30910  303.  Other  adverse  divisions  immediately 
thereafter  took  place,  and  Sir  Robert  Peel  announced  his  resignation  of  the  ministry  on 
April  8. 


THE   CORN   LAWS.  173 

merce.  You  may  further  examine  whether  the  principle  of  pro- 
hibition, in  which  others  of  these  duties  are  founded,  be  not 
carried  to  an  extent  injurious  alike  to  the  income  of  the  state  and 
the  interest  of  the  people.  Her  Majesty  is  desirous  that  you 
should  consider  the  laws  which  regulate  the  trade  in  corn.  It 
will  be  for  vou  to  determine  whether  those  laws  do  not  aggravate 
the  natural  fluctuation  of  supply,  whether  they  do  not  embarrass 
trade,  derange  currency,  and  by  their  operation  diminish  the  com- 
fort and  increase  the  privations  of  the  great  body  of  the 
community."  Surely  this  was  a  programme  more  liberal  than 
could  have  been  expected  from  a  Conservative  ministry  ;  but  the 
temper  of  the  people  and  the  exigencies  of  the  time  demanded 
that  and  a  great  deal  more.  Gloom  and  discontent  prevailed 
extensively  throughout  the  manufacturing  districts.  The  Anti- 
Corn-Law  League  had  by  this  time  become  formidable.  The 
demand  was  loud  and  imperious  for  cheap  food,  and  the  total 
repeal  of  the  corn  laws.  And  on  the  day  fixed  for  the  announce- 
ment of  the  ministerial  measure  some  five  hundred  deputies  from 
the  Anti-Corn-Law  Associations  in  the  metropolis  and  provinces 
went  in  procession  to  the  House  of  Commons,  but  were  refused 
admittance.  Yet  with  all  this  the  government  was  not  discon- 
certed, and  with  imperturbable  gravity  on  February  9,  1842,  Sir 
Robert  Peel  exposed  the  policy  of  the  cabinet  on  the  corn  laws. 
At  first  Sir  Robert  Peel  did  not  attach  much  weight  to  the 
influence  of  these  laws.  In  his  speech  in  the  House,  he  said  that 
to  his  mind  the  question  was  not  so  much  what  was  the  price  of 
food,  as  what  was  the  command  which  the  laboring  classes  of  the 
population  had  of  all  that  constituted  the  enjoyments  of  life.  His 
belief  and  the  belief  of  his  colleagues  was,  that  it  was  important 
for  the  country  to  take  care  that  the  main  source  of  the  supply  of 
corn  should  be  derived  from  domestic  agriculture.  And  he  con- 
tended that  a  certain  amount  of  protection  was  absolutely  required 
for  that  industry.  But  he  made  a  most  important  avowal,  one 
which  no  Protectionist  ministry  had  ever  made,  that  protection 
should  not  be  retained  for  4he  special  benefit  of  any  particular 
class,  but  only  for  the  advantage  of  the  nation  at  large,  and  in  so 
far  only  as  was  consistent  with  the  general  welfare  of  all  classes 
of  society.  Sir  Robert  Peel  then  entered  on  the  extent  of  such 
protection,  and  having  taken  545.  to  585.  per  quarter,  as  the  price 
at  which  corn  should  range  for  a  fair  remuneration  to  the  agri- 
culturist, he  asked,  Shall  the  corn  laws  be  based  on  a  sliding 


174  SELECTIONS. 

scale,  or  on  a  fixed  duty?  Much  might  be  said  for  the  one  and 
for  the  other.  A  sliding  scale  was  introduced  in  France  in  1819, 
one  had  been  adopted  in  Belgium,  the  Netherlands,  and  other 
countries,  and  it  seemed  to  have  the  advantage  of  adapting  itself 
to  every  circumstance.  But  experience  did  not  confirm  the  hopes 
entertained  of  its  working.  It  did  not  hinder  prices  falling  lower 
than  was  desirable  in  years  of  scarcity ;  and  it  had  the  same  prej- 
udicial effect  as  every  corn  law  of  causing  the  cultivation  of 
land  to  be  regulated,  not  by  inherent  capacity,  but  by  the  amount 
of  forced  stimulus  given  to  it  by  the  Legislature.  Besides  these 
radical  defects  the  objections  urged  against  the  sliding  scale  were, 
that  the  reduction  of  duty  was  so  rapid  as  to  hold  out  temptation 
to  fraud ;  that  it  operated  as  an  inducement  to  retain  corn,  or 
combine  for  the  purpose  of  influencing  the  averages  ;  that  the 
rapid  decline  of  the  duty  was  injurious  to  the  consumer,  the  pro- 
ducer, the  revenue,  and  the  commerce  of  the  country;  that  it  was 
injurious  to  the  consumer  because,  when  corn  was  at  a  high 
price — say,  between  66s.  and  708. —  and  just  when  it  would  be  for 
the  public  advantage  that  corn  should  be  liberated  for  the  purpose 
of  consumption,  the  joint  operation  of  increased  price  and 
diminished  duty  induced  the  holders  to  keep  it  back,  in  the  hope 
of  realizing  the  price  of  upwards  of  705.  and  so  paying  only  is. 
duty  ;  that  it  operated  injuriously  to  the  agricultural  interest,  be- 
cause it  held  out  a  temptation  to  keep  back  corn  until  it  could 
be  suddenly  entered  for  consumption  at  the  lowest  amount  of 
duty,  when  the  agriculture  lost  the  protection  which  the  law  in- 
tended it  should  possess ;  that  it  was  injurious  to  the  revenue, 
because,  instead  of  corn  being  entered  for  home  consumption 
when  it  arrived,  it  was  retained  until  it  could  be  introduced  at 
is.,  the  revenue  losing  the  difference  between  is.  and  the  amount 
of  duty  which  would  otherwise  have  been  levied  ;  that  it  was 
injurious  to  commerce,  because,  when  corn  was  grown  at  a  dis- 
tance—  in  America  for  instance  — the  grower  was  subject  to  the 
disadvantage  that  before  his  cargo  arrived  in  this  country  the  sud- 
den entries  of  wheat  at  is.  duty  from  countries  nearer  England 
might  have  so  diminished  the  price  and  increased  the  duty,  as  to 
cause  his  speculation  to  prove  not  only  a  failure  but  ruinous. 
These  were  formidable  objections  to  any  sliding  scale,  but  be- 
tween a  gradual  and  a  fixed  rate  of  duty  there  was  not  a  material 
difference.  On  the  other  hand,  a  fixed  duty  of  8s.  per  quarter  was 
too  low  as  a  protection  in  time  of  abundance,  and  was  in  effect  a 


THE   CORN   LAWS.  1/5 

prohibitory  duty  in  time  of  scarcity.  Nor  was  it  possible  to  main- 
tain more  than  a  nominal  dujty  when  prices  began  to  rise.  It  was 
indeed  difficult  to  strike  the  balance  of  advantage  and  inconvenience 
between  the  sliding  scale  and  the  fixed  duty.  So,  on  the  whole, 
Sir  Robert  Peel  favored  the  principle  of  the  sliding  scale  —  that  is, 
of  making  the  duty  upon  corn  vary  inversely  with  the  price  in 
the  home  market,  taking  the  average  of  the  market  prices  from 
returns  collected  by  excise  officers.  Having,  therefore,  decided 
on  charging  2os.  duty  when  the  average  price  of  wheat  was  503. 
and  513.  per  quarter,  he  proposed  to  make  the  duty  fall  by  a  re- 
duction of  is.  a  quarter  as  the  average  price  rose  is.  with  some 
slight  modifications,  so  that  the  duty  should  be  only  is.  per  quar- 
ter, when  the  price  of  wheat  rose  to  735.  a  quarter  and  upwards, 
and  a  bill  so  framed  he  presented  to  the  House  of  Commons.  The 
House  was  not  prepared  at  the  time  for  a  very  liberal  measure. 
Lord  John  Russell  made  a  motion  in  favor  of  a  fixed  duty,  but 
it  was  not  popular,  and,  notwithstanding  a  few  expressions  of 
dissatisfaction,  the  Government  proposal  was  well  received. 
Lord  John  Russell's  amendment  was  lost  by  226  to  349,  and  Sir 
Robert  Peel's  bill  passed  into  law.1  But  the  country  was  not 
satisfied.  Meetings  continued  to  be  held  in  the  manufacturing 
districts,  and  Mr.  Villiers,  stimulated  by  the  representations  and 
efforts  of  the  Anti-Corn-Law  League,  again  brought  forward  his 
motion  for  the  total  repeal  of  the  corn  laws,  which  was  again  lost 
by  the  enormous  majority  of  90  to  393.  The  battle  of  the  corn 
laws  had  by  this  time  become  violent,  both  in  and  out  of  Parlia- 
ment, and  Mr.  Villiers  was  not  likely  to  be  dispirited  by  the 
result  of  this  division. 

It  is  not,  however,  by  the  vain  attempt  to  render  a  corn  law 
acceptable  that  the  commercial  administration  of  Sir  Robert  Peel 
will  be  remembered.  That  was,  at  best,  a  temporary  and  transi- 
tory measure.  It  is  when  we  consider  his  financial  policy  as  a 
whole,  and  more  especially  the  plan  which  he  devised  for  improv- 
ing the  state  of  the  finances,  and  imparting  new  life  to  commerce 
and  industry,  that  we  recognize  the  breadth  of  view,  the  sound 
wisdom,  and  practical  knowledge  which  Sir  Robert  Peel  pos- 
sessed. For  years  past  the  finances  of  the  country  had  fallen  into 
complete  disorder.  An  annual  deficiency  of  one  or  two  millions 
had  become  a  chronic  evil,  and  no  means  of  escape  presented  it- 

1 5  &  6  Viet.  c.  14.     [Table  omitted.] 


176  SELECTIONS. 

self.1  With  a  disaffected  people,  and  frequent  riots  in  the  manu- 
facturing districts,  with  a  paralysed  trade,  and  wages  reduced  to 
a  very  low  scale,  any  idea  of  imposing  new  taxes,  or  making 
those  existing  heavier,  was  out  of  the  question.  A  temporary  and 
casual  deficiency,  might  have  been  met  by  an  issue  of  exchequer 
bills ;  but  what  would  have  been  the  use  of  resorting  to  such 
expedient  when  there  was  no  ground  whatever  for  expecting  any 
immediate  improvement?  On  the  other  hand,  to  have  recourse 
to  loans  in  times  of  peace  in  order  to  balance  the  revenue  and 
expenditure,  was  equally  inadmissible.  Sir  Robert  Peel  knew 
that  a  timely  and  moderate  reduction  of  taxes  is  favorable  rather 
than  injurious  to  the  revenue.  He  knew  that,  though  for  the 
moment  such  a  reduction  might  show  a  loss,  nevertheless,  by  the 
stimulus  it  affords  to  increasing  consumption,  the  revenue  would 
soon  recover  itself,  and  probably  exceed  the  amount  previously 
produced.  Yet,  unfortunately,  the  few  precedents  he  had  for 
such  an  operation,  attempted  in  times  not  very  prosperous,  were 
not  encouraging.  In  1825  the  revenue  from  wine  amounted  to 
£2,153,000.  The  duty  was  then  reduced  from  95.  i%d.  to 
45.  2^d.  per  gallon  ;  and  what  was  the  result?  The  year  after  the 
revenue  was  £1,400,000;  it  afterwards  increased  to  £1,700,000, 
but  it  fell  again  to  £1,400,000.  The  duty  on  tobacco  had  been 
reduced  from  45.  to  33.  per  Ib.  Before  the  reduction  the  revenue 
was  £3,378,000;  immediately  after  it  fell  to  £2,600,000;  and, 
though  it  rose  somewhat  from  that  point,  it  did  not  reach  the 
previous  amount.  Of  course  the  consumption  of  articles  of 
luxury,  such  as  wine  and  tobacco,  is  not  so  affected  by  a  reduc- 
tion of  duty,  as  that  of  tea,  sugar,  and  other  necessaries  of  life. 
Moreover,  the  resources  of  the  country  were,  at  that  time,  com- 
paratively undeveloped  to  admit  of  any  large  increase  of  con- 
sumption. Still,  such  experience  did  not  warrant  the  expectation 
that  a  reduction  of  taxes  would  have  the  effect  of  filling  the  ex- 
chequer. 

But  the  circumstances  of  trade  required  instant  relief,  and  the 
tariff  needed  a  thorough  reform  and  simplification.  Two  years 
before,  in  1840,  on  the  motion  of  Mn  Hume,  a  committee  of  the 
House  of  Commons  was  appointed  to  inquire  into  the  duties  levied 
on  imports,  and  to  determine  how  far  they  were  imposed  for  pur- 

i  The  deficiency  in  the  year  ended  April  5,  1841,  was  £1,157,601 ;  in  the  year  ended  April 
S,  1842,  £117,627;  and  1843,  £2,704,510. 


THE   CORN   LAWS.  1 77 

poses  of  revenue  ;  and  in  their  report  the  committee  said  :  "  The 
tariff  of  the  United  Kingdom  presents  neither  congruity  nor  unity 
of  purpose  ;  no  general  principles  seem  to  have  been  applied. 
The  tariff  often  aims  at  incompatible  ends  ;  the  duties  are  some- 
times meant  to  be  both  productive  of  revenue  and  for  protection, 
objects  which  are  frequently  inconsistent  with  each  other.  Hence 
they  sometimes  operate  to  the  complete  exclusion  of  foreign  pro- 
duce, and,  in  so  far,  no  revenue  can  of  course  be  received;  and 
sometimes,  when  the  duty  is  inordinately  high,  the  amount  of 
revenue  is,  in  consequence,  trifling.  They  do  not  make  the  re- 
ceipt of  revenue  the  main  consideration,  but  allow  that  primary 
object  of  fiscal  regulations  to  be  thwarted  by  the  attempt  to  pro- 
tect a  great  variety  of  particular  interests  at  the  expense  of  revenue, 
and  of  the  commercial  intercourse  with  other  countries.  Whilst 
the  tariff  has  been  made  subordinate  to  many  small-producing 
interests  at  home  by  the  sacrifice  of  revenue,  in  order  to  support 
their  interest,  the  same  principle  of  interference  is  largely  applied, 
by  the  various  discriminating  duties,  to  the  produce  of  our  col- 
onies, by  which  exclusive  advantages  are  given  to  the  colonial 
interests  at  the  expense  of  the  mother  country."  Such  were  the 
general  features  of  the  tariff,  the  result  of  years  of  careless  legis- 
lation on  the  subject.  The  fact  was  indeed  too  evident  that  it 
was  necessary  to  prune  the  over-burdened  tariff,  and  to  liberate 
a  large  variety  of  articles  from  the  needless  trammels  of  legisla- 
tion. 

But  how  to  accomplish  this  without  a  handsome  surplus  rev- 
enue? Fortunately  Sir  Robert  Peel,  undeterred  by  the  state  of 
the  revenue,  determined  to  do  what  was  necessary  for  trade. 
And  he  acted  wisely.  Untrammel  industry  from  the  bonds  of 
legal  restrictions,  open  the  avenue  to  wealth  and  prosperity  :  that 
is  the  right  policy.  Pursue  this  course,  and  there  is  no  fear 
but  the  revenue  will  set  itself  speedily  right.  Some  slight 
reductions  he  made  in  1841,  but  on  March  u,  1842,  in  his 
famous  financial  statement,  he  proposed  to  reduce  considerably 
all  the  duties  on  the  raw  materials  of  manufacture,  all  duties  on 
goods  partially  or  wholly  manufactured,  as  well  as  the  duties  on 
timber,  and  all  export  duties,  together  producing  £1,500,000; 
and  to  make  up  this  loss,  as  w'ell  as  the  duties  on  timber  and  all  ex- 
port duties,  together  producing  £\  ,500,000;  and  to  make  up  this 
loss,  and  to  provide  for  the  original  deficit  in  the  revenue,  amount- 
ing to  £2,570,000,  by  an  income  and  property  tax  of  7d.  in  the 


178  SELECTIONS. 

pound,  which  he  expected  would  produce  £3, 700.000  ;*  by  the 
equalization  of  the  stamp  and  spirit  duties,  which  would  give 
£400,000 ;  and  by  a  small  tax  on  the  exportation  of  coals,  which 
would  give  £200,000,  making  in  all  £4,310.000.  It  was  a  very 
simple  plan  ;  yet  there  was  profound  wisdom  in  Sir  Robert  Peel's  • 
budget.  The  value  of  the  reductions  proposed  far  exceeded  the 
amount  of  relief  in  taxation  they  each  and  collectively  afforded. 
The  removal  of  the  taxes  on  raw  materials  was  a  great  boon, 
inasmuch  as  they  had  the  effect  of  putting  our  manufactures  in  a  dis- 
advantageous position  in  the  markets  of  the  world,  and  restrict- 
ing the  field  for  the  employment  of  capital  and  labor.  As  was 
said  in  the  discussion  on  the  budget,  suppose  50,000  head  of  cattle 
were  to  be  annually  imported  in  consequence  of  such  remissions, 
such  importation  would  produce  but  a  small  effect  on  the  price 
of  meat,  but  it  would  create  an  import  trade  to  the  amount  of 
half  a  million  of  money,  a  trade  which,  in  its  nature,  would  tend 
to  produce  an  export  trade,  in  return,  of  an  equal  amount. 
Our  export  trade  is  measured  and  limited  by  our  import  trade. 
If  an  individual  merchant  cannot  afford  to  send  his  goods  to  other 
countries  without  obtaining  any  return,  neither  can  all  merchants 
collectively,  and  the  country  as  a  whole,  afford  to,  export  com- 
modities to  foreign  countries,  if  in  some  shape  or  other  imports 
are  not  received  from  those  countries  in  return.  Reduce  the  duties 
on  imports,  and  you  thereby  promote  the  export  of  our  produce 
and  manufactures.  Remove  those  taxes  which  burden  our  manu- 
factures, and  you  promote  the  importation  of  those  articles  which 
are  necessary  to  the  comfort  and  welfare  of  the  nation.  The  in- 
come tax  might  be  odious,  "  inquisitorial,  intolerable,"  yet  it 
was  at  that  time  the  only  means  by  which  the  necessary  reforms 
in  the  tariff' could  be  attempted.  And  the  nation,  having  balanced 
the  evil  and  the  good  of  the  pi'oposal,  and  being  convinced  that 
the  advantages  preponderated,  cheerfully  accepted  the  government 
proposal,  and  gave  to  the  proposal  its  hearty  consent. 

The  commercial  policy  thus  inaugurated  by  Sir  Robert  Peel, 
being  in  perfect  accord  with  sound  economic  principles,  could  not 
fail  to  be  successful.  From  1841  to  1843,  as  we  have  seen,  there 
was  a  yearly  deficit  in  the  budget.  In  the  year  ending  April  5, 
1844,  Sir  Robert  Peel  found  himself  "in  possession  of  a  handsome 

1  The  amount  of  duty  assessed,  in  1843,  was  £5,608,348.  The  amount  of  property  assessed 
was:  Schedule  A,  £95,284,497;  Schedule  B,  £46,769,915;  Schedule  C,  £27,909,793;  Schedule 
D>£7' >330,344;  Schedule  E,  £9,718,454.  Total,  £251,013,003.  [Additional  note  omitted.] 


THE   CORN  LAWS.  1/9 

surplus  of  £2,600,000,  which  was  exceeded  in  the  following  year, 
and  continued  at  a  high  point  for  four  consecutive  years.1  The 
exports  of  British  produce,  which  in  1842  had  fallen  to  £47,000,- 
ooo,  increased  to  £52,000,000  in  1843  ;  to  £58,000,000  in  1844; 
and  £60,000,000  in  1845.  The  shipping  entered  and  cleared  in- 
creased from  9,000,000  tons  in  1842  to  12,000,000  tons  in  1845. 
In  every  way,  financially  and  commercially,  the  results  fully 
realized  the  anticipations  formed,  and  Sir  Robert  was  encouraged 
to  advance  still  further  in  the  same  direction.  Nothing  important 
was  attempted  in  the  budget  of  1843,*  but  in  1844  the  duty  on 
wool  was  abolished ;  the  duties  on  currants  and  coffee  were  re- 
duced, and  a  great  change  was  made  on  the  duties  on  marine 
insurance.  And  then,  as  we  have  seen  in  the  previous  chapter, 
the  differential  duties  against  foreign-grown  sugar  were  relaxed, 
by  permitting  the  importation  of  sugar,  the  growth  of  China, 
Java,  or  Manilla,  or  of  any  other  countries  which  Her  Majesty  in 
council  shall  have  declared  to  be  admissible,  at  moderate  rates. 
In  1845  another  still  more  important  series  of  reform  was  intro- 
duced. The  duty  on  cotton  wool,  which,  however  slight  and  in- 
appreciable on  the  coarser  material,  pressed  rather  heavily  on  the 
finer  muslin,  was  abolished.  The  export  duty  on  coals,  which 
had  been  found  vexatious  and  injurious,  was  removed.  The 
timber  duties  were  further  reduced.  The  duty  on  glass  was  re- 
moved from  the  tariff,  and  also  the  duties  on  four  hundred  and 
thirty  articles,  which  produced  little  or  no  revenue,  including 
fibrous  materials,  such  as  silk,  hemp,  and  flax,  furniture,  woods, 
cabinet-makers'  materials,  animal  and  vegetable  oil,  ores  and 
minerals,  etc.  In  1846  the  liberal  policy  was  further  extended. 
Hitherto  our  manufacturers  had  been  benefited  by  the  free  access 
granted  to  the  raw  materials.  It  was  right  to  ask  of  them  to 
relinquish  some,  at  least,  of  the  protecting  duties  still  in  existence. 
And  the  duties  on  linen,  woollen,  and  cotton  manufactures  were 
reduced  from  20  to  10  per  cent.  The  silk  duties,  then  at  30  per 
cent.,  were  also  reduced  to  15  per  cent.  A  reduction  was  made 
on  the  duties  on  stained  paper,  on  manufactures  of  metals,  on 
earthenware,  on  carriages,  and  on  manufactures  of  leather ;  and 
the  duties  on  butter,  cheese,  and  hops  were  further  reduced.3 

*The  surplus  in  the  year  ended  April  5,  1844,  was  £2,685,125;  1845,  £3,027,615;  1846, 
£1,647,324;   and  in  1847,  £2,823,762. 

2  [Foot-note  on  "  Taxes  Reduced  or  Repealed,"  omitted.] 

3  in  1842  there  were  1,090  articles  and  subdivisions  of  articles  charged  with  distinct  rates 
of  import  duty  in  the  Customs  Tariff.     In  1846  the  number  was  reduced  to  424. 


l8o  SELECTIONS. 

But  was  it  right  to  effect  all  these  reforms  without  asking  for 
reciprocity  on  the  part  of  foreign  countries?  For  years  past  it 
was  known  that  Her  Majesty's  government  had  used  every  effort 
to  enter  into  treaties  with  several  states,  such  as  Brazil,  Portugal, 
Spain,  and  France,  with  a  view  to  enter  into  a  system  of  mutual 
concessions.  In  1843  and  1844  Mr.  Ricardo  brought  the  subject 
before  the  House  of  Commons,  and  moved  for  an  address  to  Her 
Majesty,  praying  that  Her  Majesty  be  pleased  to  give  directions 
to  her  servants  not  to  enter  into  any  negotiations  with  foreign 
powers  which  would  make  any  contemplated  alterations  of  the 
tariff  of  the  United  Kingdom  contingent  on  the  alterations  of 
the  tariff  of  other  countries ;  and  expressing  to  Her  Majesty  the 
opinion  of  the  House,  that  the  great  object  of  relieving  the  com- 
mercial intercourse  between  this  country  and  foreign  nations  from 
all  injurious  restrictions,  would  be  best  promoted  by  regulating 
our  own  customs  duties,  as  might  be  most  suitable  to  the  financial 
and  commercial  interests  of  this  country,  without  reference  to  the 
amount  of  duties  which  foreign  powers  might  think  it  expedient 
for  their  own  interest  to  levy  on  British  goods.  But  the  govern- 
ment opposed  the  motion,  and  Mr.  Ricardo  was  defeated.  Mr. 
Gladstone  especially  defended  the  policy  of  endeavoring  to  obtain 
such  treaties.  He  did  not  wish,  he  said,  "to  be  trammelled  by 
an  abstract  proposition,  and  unless  Mr.  Ricardo  could  show  that 
there  were  no  possible  circumstances  in  which  a  commercial 
treaty  could  be  aught  other  than  evil,  he  had  no  right  to  call  upon 
the  House  to  affirm  his  resolution."  The  government,  however, 
now  practically  acted  on  the  policy  advocated  by  Mr.  Ricardo, 
and  Sir  Robert  Peel  avowed  it  frankly. 

•'  I  have  no  guarantee,"  he  said,1  "  to  give  you  that  other  coun- 
tries will  immediately  follow  our  example.  I  give  you  that 
advantage  in  the  argument.  Wearied  with  our  long  and  unavail- 
ing efforts  to  enter  into  satisfactory  commercial  treaties  with  other 
nations,  we  have  resolved  at  length  to  consult  our  interests,  and 
not  to  punish  other  countries  for  the  wrong  they  do  us  in  contin- 
uing their  high  duties  upon  the  importation  of  our  products  and 
manufactures,  by  continuing  high  duties  ourselves,  encouraging 
unlawful  trade.  We  have  had  no  communication  with  any  for- 
eign government  upon  the  subject  of  these  reductions.  We  can- 
not promise  that  France  will  immediately  make  a  corresponding 

i  Hansard's  Debate*,  Jan.  27, 1846. 


THE   CORN  LAWS.  l8l 

reduction  in  her  tariff.  I  cannot  promise  that  Russia  will  prove 
her  gratitude  to  us  for  our  reduction  of  duty  on  her  tallow  by  any 
diminution  of  her  duties.  You  may,  therefore,  say,  in  opposition 
to  the  present  plan,  '  What  is  this  superfluous  liberality  that  you 
are  going  to  do  away  with  all  these  duties,  and  yet  you  expect 
nothing  in  return?'  I  may,  perhaps,  be  told  that  many  foreign 
countries,  since  the  former  relaxation  of  duties  on  our  part  —  and 
that  would  be  perfectly  consistent  with  the  fact  —  foreign  coun- 
tries, which  have  benefited  by  our  relaxations,  have  not  fol- 
lowed our  example  :  nay,  have  not  only  not  followed  our  example, 
but  have  actually  applied  to  the  importation  of  British  goods 
higher  rates  of  duties  than  formerly.  I  quite  admit  it.  I  give 
you  all  the  benefit  of  that  argument.  I  rely  upon  that  fact 
as  conclusive  proof  of  the  policy  of  the  course  we  are  pursu- 
ing. It  is  a  fact,  that  other  countries  have  not  followed  our 
example,  and  have  levied  higher  duties  in  some  cases  upon  our 
goods.  But  what  has  been  the  result  upon  the  amount  of  your 
exports?  You  have  defied  the  regulations  of  these  countries. 
Your  export  trade  is  greatly  increased.  Now,  why  is  that  so? 
Partly  because  of  your  acting  without  wishing  to  avail  yourselves 
of  their  assistance  ;  partly  because  of  the  smuggler,  not  engaged 
by  you,  in  so  many  continental  countries,  whom  the  strict  regula- 
tions and  the  triple  duties  which  are  to  prevent  the  ingress  of 
foreign  goods  have  raised  up  ;  and  partly,  perhaps,  because  these 
very  precautions  against  the  ingress  of  your  commodities  are  a  bur- 
den, and  the  taxation  increasing  the  cost  of  production,  disqualify 
the  foreigner  from  competing  with  you.  But  your  exports, 
whatever  be  the  tariff  of  other  countries,  or  however  apparent 
the  ingratitude  with  which  they  have  treated  you,  your  export 
trade  has  been  constantly  increasing.  By  the  remission  of  your 
duties  upon  the  raw  material,  by  inciting  your  skill  and  industry, 
by  competition  with  foreign  goods,  you  have  defied  your  compet- 
itors in  foreign  markets,  and  you  have  been  enabled  to  exclude 
them.  Nothwithstanding  their  hostile  tariffs  the  declared  value 
of  British  exports  has  increased  above  £10,000,000  during  the 
period  which  has  elapsed  since  the  relaxation  of  duties  on  your 
part.  I  say,  therefore,  to  you,  that  these  hostile  tariffs,  so  far 
from  being  an  objection  to  continuing  your  policy,  are  an  argu- 
ment in  its  favor.  But,  depend  upon  it,  your  example  will  ulti- 
mately prevail.  When  your  example  could  be  quoted  in  favor 
of  restriction,  it  was  quoted  largely.  When  your  example  can 


1 82  SELECTIONS. 

be  quoted  in  favor  of  relaxation  as  conducive  to  your  interest,  it 
may,  perhaps,  excite  at  first  in  foreign  governments,  in  foreign 
boards  of  trade,  but  little  interest  or  feeling ;  but  the  sense  of  the 
people  of  the  great  body  of  consumers  will  prevail ;  and  in  spite 
of  the  desire  of  government  and  boards  of  trade  to  raise  revenue 
by  restrictive  duties,  reason  and  common  sense  will  induce  relax- 
ation of  high  duties.  That  is  my  firm  belief."  .... 

PART  IV.  — CHAP.  4. 

The  Anti-Corn  Law  agitation  was  one  of  those  movements 
which,  being  founded  on  right  principles,  and  in  harmony  with 
the  interest  of  the  masses,  was  sure  to  gather  fresh  strength  by 
any  event  affecting  the  supply  of  food.  It  was  popular  to  attempt 
to  reverse  a  policy  which  aimed  almost  exclusively  to  benefit  one 
class  of  society.  It  was  well  known  that  the  League  wanted  to 
outset  an  economic  fallacy,  and  that  they  wished  to  relieve  the 
people  from  a  great  burden.  And  as  time  elapsed  and  the  sound- 
ness of  the  principles  propounded  by  the  League  at  their  public 
meetings  was  more  and  more  appreciated,  their  triumph  became 
certain,  and  Her  Majesty's  government  itself  began  to  see  that  it 
was  no  longer  possible  to  treat  the  agitation  either  bv  a  silent 
passiveness,  or  by  expressed  contempt.  The  economic  theorists 
had  the  mass  of  the  people  with  them.  Their  gatherings  were 
becoming  more  and  more  enthusiastic.  And  even  amidst  con- 
servative landowners  there  were  not  a  few  enlightened  and  lib- 
eral minds  who  had  already,  silently  at  least,  espoused  the  new 
ideas.  No  change  certainly  could  be  expected  so  long  as  bread 
was  cheap,  and  labor  abundant.  But  when  a  deficient  harvest 
and  a  blight  in  the  potato-crop  crippled  the  resources  of  the  peo- 
ple and  raised  grain  to  famine  prices,  the  voice  of  the  League 
acquired  greater  power  and  influence.  Hitherto  they  had  re- 
ceived hundreds  of  pounds.  Now,  thousands  were  sent  in  to 
support  the  agitation.  A  quarter  of  a  million  was  readily  con- 
tributed. Nor  were  the  contributors  Lancashire  mill-owners 
exclusively.  Among  them  were  merchants  and  bankers,  men  of 
heart  and  men  of  mind,  the  poor  laborer,  and  the  peer  of  the 
realm.  The  fervid  oratory  of  Bright,  the  demonstrative  and 
argumentative  reasoning  of  Cobden,  the  more  popular  appeals  of 
Fox,  Rawlins,  and  other  platform  speakers,  filled  the  newspaper 
press,  and  were  eagerly  read.  And  when  Parliament  dissolved  in 


THE  CORN  LAWS.  183 

August,  1845,  even  Sir  Robert  Peel  showed  some  slight  symp- 
toms of  a  conviction  that  the  days  of  the  corn  laws  were  num- 
bered. Every  day,  in  truth,  brought  home  to  his  mind  a  stronger 
need  for  action,  and  as  the  ravages  of  the  potato  disease  pro- 
gressed he  saw  that  all  further  resistance  would  be  absolutely 
dangerous. 

A  cabinet  council  was  held  on  October  31  of  that  year,  to  con- 
sult as  to  what  was  to  be  done,  and  at  an  adjourned  meeting  on 
November  5,  Sir  Robert  Peel  intimated  his  intention  to  issue  an 
order  in  council  remitting  the  duty  on  grain  in  bond  to  one  shill- 
ing, and  opening  the  ports  for  the  admission  of  all  species  of  grain 
at  a  smaller  rate  of  duty,  until  a  day  to  be  named  in  the  order ;  to 
call  Parliament  together  on  the  ayth  inst.,  in  order  to  ask  for  an 
indemnity,  and  a  sanction  of  the  order  by  law;  and  to  submit  to 
Parliament,  immediately  after  the  recess,  a  modification  of  the 
existing  law,  including  the  admission  at  a  nominal  duty,  of  Indian 
corn  and  of  British  colonial  corn.  A  serious  difference  of  opinion, 
however,  was  found  to  exist  in  the  cabinet,  on  the  question  brought 
before  them  ;  the  only  ministers  supporting  such  measures  being 
the  Earl  of  Aberdeen,  Sir  James  Graham,  and  Mr.  Sidney  Her- 
bert. Nor  was  it  easy  to  induce  the  other  members  to  listen  to 
reason.  And  though,  at  a  subsequent  meeting,  held  on  November 
28,  Sir  Robert  Peel  so  far  secured  a  majority  in  his  favor,  it  was 
evident  that  the  cabinet  was  too  divided  to  justify  him  in  bringing 
forward  his  measures,  and  he  decided  upon  resigning  office. 

His  resolution  to  that  effect  having  been  communicated  to  the 
Queen,  Her  Majesty  summoned  Lord  John  Russell  to  form  a 
cabinet ;  and,  to  smooth  his  path,  Sir  Robert  Peel,  with  character- 
istic frankness,  sent  a  memorandum  to  Her  Majesty,  embodying  a 
promise  to  give  him  his  support.  But  Lord  John  Russell  failed 
in  his  efforts,  and  the  Queen  had  no  alternative  but  to  recall  Sir 
Robert  Peel,  and  give  him  full  power  to  carry  out  his  measures. 
It  was  under  such  circumstances  that  Parliament  was  called  for 
January  22,  1846,  and  on  January  27  the  government  plan  was 
propounded  before  a  crowded  house.  It  was  not  an  immediate 
repeal  of  the  corn  laws  that  Sir  Robert  Peel  recommended.  He 
proposed  a  temporary  protection  for  three  years,  till  February  I, 
1849,  imposing  a  scale  during  that  time  ranging  from  45.,  when 
the  price  of  wheat  should  be  505.  per  quarter  and  upward,  and 
IDS.  when  the  price  should  be  under  485.  per  quarter,  and  that 
after  that  period  all  grain  should  be  admitted  at  the  uniform  duty 


1 84  SELECTIONS. 

of  is.  per  quarter.  The  measure,  as  might  have  been  expected, 
was  received  in  a  very  different  manner  by  the  political  parties  in 
both  houses  of  Parliament.  There  was  treason  in  the  conserva- 
tive camp,  and  keen  and  bitter  was  the  opposition  they  offered  to 
the  chief  of  their  party.  For  twelve  nights  speaker  after  speaker 
indulged  in  personal  recriminations.  They  recalled  to  Sir  Robert 
Peel's  memorv  the  speeches  he  had  made  in  defence  of  the  corn 
laws.  And  as  to  his  assertion  that  he  had  changed  his  mind  they 
denied  his  right  to  do  so.  Mr.  Colquhoun  "  wondered  that  Sir 
Robert  could  say,  '  I  have 'changed  my  opinion,  and  there  is  an 
end  of  it.'  But  there  was  not  an  end  of  it.  His  right  hon. 
friend  must  not  forget  the  laws  by  which  the  words  of  men  of 
genius  —  whether  orators  or  poets  —  are  bound  up  with  them. 
His  right  hon.  friend's  words  could  not  thus  pass  away.  They 
were  winged  shafts  that  pierced  many  minds.  They  remained 
after  the  occasion  which  produced  them  passed  away.  His 
right  hon.  friend  must  remember  that  the  words  which  he 
had  used  adhered  to  the  memory,  moulded  men's  sentiments, 
guided  public  opinion.  He  must  recollect  that  the  armor  of 
proof  which  he  had  laid  aside,  and  the  lance  which  he  had 
wielded,  and  with  which  he  had  pierced  many  an  encumbered 
opponent,  remained  weighty  and  entire.  Greatly  did  he  wish 
that  his  right  hon.  friend  were  again  on  this  side  to  wield 
them  —  that  he  were  here  to  lead  their  ranks  and  guide  them  by 
his  prowess.  But  if  not,  they  retained  at  least  his  arms  ;  these 
lay  at  their  feet,  strewed  all  around  them,  an  arsenal  of  power." 
Petulant  remonstrances  like  these  were  of  course  of  little  avail. 
Sir  Robert  Peel  and  Mr.  Cobden  were  ready  to  meet  every  chal- 
lenge, and  to  refute  every  argument  with  their  unanswerable  logic 
of  facts.  And  when  the  opposition  endeavored  to  throw  all  the 
responsibility  of  a  measure  of  such  a  character  on  the  prime 
minister,  Mr.  Cobden  besought  them  to  turn  from  the  will  of  one 
individual  to  those  laws  economic  and  divine  which  seemed  to 
impose  the  duty  of  laying  wide  open  the  door  for  the  importation 
of  food.  "  Oh,  then,  divest  the  future  prime  minister  of  this 
country  of  that  odious  task  of  having  to  reconcile  rival  interests ; 
divest  the  office,  if  ever  you  would  have  a  sagacious  man  in  power 
as  prime  minister,  divest  it  of  the  responsibility  of  having  to  find 
food  for  the  people  !  May  you  never  find  a  prime  minister  again 
to  undertake  that  awful  responsibility  !  That  responsibility  belongs 
to  the  law  of  nature  :  as  Burke  said,  '  it  belongs  to  God  alone  to 


THE   CORN   LAWS.  185 

regulate  the  supply  of  the  food  of  nations.'  .  .  .  We  have 
set  an  example  to  the  world  in  all  ages;  we  have  given  them  the 
representative  system.  The  very  rules  and  regulations  of  this 
House  have  been  taken  as  the  model  for  every  representative  as- 
sembly throughout  the  whole  civilized  world  ;  and  having  besides 
given  them  the  example  of  a  free  press,  and  civil  and  religious 
freedom,  and  every  institution  that  belongs  to  freedom  and  civiliza- 
tion, we  are  now  about  giving  a  still  greater  example  ;  we  are 
going  to  set  the  example  of  making  industry  free — to  set  the 
example  of  giving  the  whole  world  every  advantage  of  clime  and 
latitude  and  situation,  relying  ourselves  on  the  freedom  of  our 
industry.  Yes,  we  are  going  to  teach  the  world  that  other  lesson. 
Don't  think  there  is  anything  selfish  in  this,  or  anything  at  all 
discordant  with  Christian  principles.  I  can  prove  that  we  ad- 
vocate nothing  but  what  is  agreeable  to  the  highest  behests  of 
Christianity.  To  buy  in  the  cheapest  market  and  sell  in  the 
dearest.  What  is  the  meaning  of  the  maxim?  It  means  that  you 
take  the  article  which  you  have  in  the  greatest  abundance,  and 
with  it  obtain  from  others  that  of  which  they  have  the  most  to 
spare,  so  giving  to  mankind  the  means  of  enjoying  the  fullest 
abundance  of  earth's  goods,  and  in  doing  so  carrying  out  to  the 
fullest  extent  the  Christian  doctrine  of  '  Do  ye  to  all  men  as  ye 
would  they  should  do  unto  you  ' '  The  passing  of  the  measure 
was,  however,  more  than  certain,  and  after  a  debate  of  twelve 
nights'  duration  on  Mr.  Miles'  amendment,  the  government  ob- 
tained a  majority  of  97  ;  337  having  voted  for  the  motion  and  240 
against  it.  And  from  that  evening  the  corn  law  may  be  said  to 
have  expired.1  Not  a  day  too  soon,  certainly,  when  we  consider 
the  straitened  resources  of  the  country  as  regards  the  first  article 
of  food,  caused  not  only  by  the  bad  crop  of  grain,  but  by  the 
serious  loss  of  the  potato  crop,  especially  in  Ireland. 

Ireland  had  often  grievously  suffered  from  social  and  political 
wrongs,  from  absenteeism  and  repeal  cries,  from  Protestant  and 
Roman  Catholic  bigotry,  from  Orangeism  and  Ribbonism,  from 
threatening  notices  and  mid-day  assassinations,  but  seldom  has  her 
cup  of  adversity  been  so  brimful  as  in  1845  and  1846,  from  the 
failure  of  the  potato  crop.  Though  comparatively  of  recent  intro- 
duction,— the  first  potato  root  having  been  imported  by  Sir  Walter 
Raleigh  in  1610, — potatoes  had  for  years  constituted  a  large  proper- 

1  9  and  10  Viet.  c.  22,  suspended  by  10  and  n  Viet.  c.  i. 


1 86  v    SELECTIONS. 

tion  of  the  food  of  the  people  of  Ireland.  A  considerable  acreage 
of  land  was  devoted  to  that  culture,  and  an  acre  of  potatoes  would 
feed  more  than  double  the  number  of  individuals  that  can  be  fed 
from  an  acre  of  wheat.  Such  cultivation  was,  moreover,  very 
attractive  to  small  holders  of  land.  It  cost  little  labor.  It  entailed 
scarcely  any  expense,  and  little  or  no  care  was  bestowed  on  it, 
since  the  people  were  quite  satisfied  with  the  coarsest  and  most 
prolific  kind,  called  lumpers  or  horse  potatoes.  Nor  was  it  the 
food  of  the  people  only  in  Ireland.  Pigs  and  poultry  shared  the 
potatoes  with  the  peasant's  family,  and  often  became  the  inmates 
of  his  cabin  also.  One  great  evil  connected  with  potatp  culture 
is,  that  whilst  the  crop  is  precarious  and  uncertain,  it  cannot  be 
stored  up.  The  surplus  of  one  abundant  year  is  quite  unfit  to  use 
in  the  next,  and  owing  to  its  great  bulk  it  cannot  even  be  trans- 
ported from  place  to  place.  Moreover,  once  used  to  a  description 
of  food  so  extremely  cheap,  no  retrenchment  is  possible,  and  when 
blight  comes  and  the  crop  is  destroyed  the  people  seem  doomed 
to  absolute  starvation.  This,  unfortunately,  was  the  case  in  1822 
and  1831.  In  those  years  public  subscriptions  were  got  up,  king's 
letters  issued,  balls  and  bazaars  held,  and  public  money  granted. 
But  in  1845  and  1846  the  calamity  was  greater  than  any  pre- 
viously experienced. 

The  potato  disease  first  manifested  itself  in  1845.  The  early 
crop,  dug  in  September  and  October,  which  consists  of  one-sixth 
of  the  whole,  nearly  escaped  ;  but  the  whole  of  the  late  crop,  the 
people's  crop,  dug  in  December  and  January,  was  tainted  before 
arriving  at  maturity.  In  that  year  there  was  a  full  average  crop 
of  wheat.  Oats  and  barley  were  abundant,  and  turnips,  carrots, 
and  greens,  including  hay,  were  sufficient.  Yet  on  the  continent 
the  rye  crop  failed,  and  the  potato  disease  appeared  in  Belgium, 
Holland,  France,  and  the  west  of  Germany.  On  the  whole  the 
supply  of  grain  was  fair  during  the  year  1845,  and  prices  ruled 
moderately  high.  In  1846,  however,  blight  attacked  the  potatoes 
with  even  greater  fury  and  suddenness  in  the  month  of  July,  and 
it  attacked  both  the  early  crop  and  the  people's  crop,  at  the  same 
time  that  the  wheat  crop  proved  under  an  average.  Barley  and 
oats  were  also  deficient,  and  the  rye  crop  again  failed  on  the  con- 
tinent. In  the  previous  year  some  counties  in  Ireland  escaped 
the  potato  disease,  but  this  year  the  whole  country  suffered  alike. 
The  loss  was  indeed  very  great.  Probably  £13,000,000  was  a 
low  estimate,  and  from  4,000,000  to  5,000,000  quarters  of  grain 


THE  CORN   LAWS.  1 87 

at  least  would  be  required  to  replace  it.  As  might  be  expected 
the  news  of  such  a  disaster  had  a  fearful  effect  throughout  the 
country,  and  the  utter  helplessness  of  many  millions  of  our  fellow- 
subjects  became  a  subject  of  the  greatest  anxiety. 

As  soon  as  the  potato  disease  appeared  in  1845,  government 
took  the  step  of  appointing  Professors  Kane,  Lindley,  and  Play- 
fair  to  inquire  into  the  nature  of  the  disease,  and  to  suggest  means 
for  preserving  the  stock,  but  this  was  of  little  avail.  Urged  bv 
necessity,  the  government  even  stepped  out  of  its  province,  and 
sent  orders  to  the  United  States  for  the  purchase  of  £100,000 
worth  of  Indian  corn,  established  depots  in  different  parts,  and 
formed  relief  committees.  But  this  was  nothing  compared  with 
what  became  necessary  to  be  done  in  1846.  Public  works  were 
then  commenced  on  a  large  scale,  giving  employment  to  some  five 
hundred  thousand  persons.  The  poor  law  was  put  in  action  with 
unparalleled  vigor,  so  that  in  July,  1847,  as  many  as  three  millions 
of  persons  were  actually  receiving  separate  rations.  A  loan  of 
£8,000,000  was  contracted  by  government,  expressly  to  supply 
such  wants,  and  every  step  was  taken  by  two  successive  administra- 
tions —  Sir  Robert  Peel's  and  Lord  John  Russell's  —  to  alleviate 
the  sufferings  of  the  people.  Nor  was  private  benevolence  lack- 
ing. The  Society  of  Friends,  always  ready  in  acts  of  charity  and 
love,  was  foremost  in  the  good  work.  A  British  Association  was 
formed  for  the  relief  of  Ireland,  including  Jones  Loyd  (Lord 
Overstone),  Thomas  Baring,  and  Baron  Rothschild.  A  Queen's 
letter  was  issued.  A  day  of  general  fast  and  humiliation  was 
held,  and  subscriptions  were  received  from  almost  every  quarter 
of  the  world.  The  Queen's  letter  alone  produced  £171,533.  The 
British  Association  collected  £263.000 ;  the  Society  of  Friends, 
£43,000;  and  £168,000  more  were  intrusted  to  the  Dublin 
Society  of  Friends.  The  Sultan  of  Turkey  sent£i,ooo.  The 
Queen  gave  £2,000,  and  £500  more  to  the  British  Ladies'  cloth- 
ing fund.  Prince  Albert  gave  £500.  The  National  Club  collected 
£17,930.  America  sent  two  ships  of  war,  the  "Jamestown"  and 
"Macedonian,"  full  of  provisions;  and  the  Irish  residents  in  the 
United  States  sent  upwards  of  £200,000  to  their  relatives  to  allow 
them  to  emigrate.  But  with  all  this,  the  people  passed  through  a 
most  eventful  catastrophe.  One-third  of  the  people,  at  least,  was 
reduced  to  destitution.  A  large  number  died  by  fever  and  pesti- 
lence. Such  as  could  raise  the  requisite  funds  emigrated  to 
America.  Crowds  of  emaciated  and  famished  people_flocked  by 


1 88  SELECTIONS. 

every  available  means  to  English  ports.  The  rest  were  kept 
alive  by  employment  on  public  works,  by  private  local  charity, 
by  local  subscriptions,  by  contributions  from  all  parts  of  the 
world,  and  by  the  most  extensive  system  of  gratuitous  distribution 
of  food  which  history  affords  any  record  of. 

The  price  of  wheat  and  other  grain  did  not  rise  much  at  first. 
Indeed,  for  a  lengthened  time  but  faint  conception  was  entertained 
of  any  want  of  foreign  grain.  The  potato  failure  was  compara- 
tively a  new  thing,  and  few  imagined  that  it  would  act  powerfully 
on  the  consumption  of  grain.  In  1845  the  average  price  of  wheat 
was  no  more  than  508.  nd.  per  imperial  quarter,  it  having  risen 
from  a  minimum  of  455.  3d.  in  March  to  585.  rod.  in  November ; 
whilst  the  average  price  of  barley  was  315.  8d.,  and  of  oats  225.  6d. 
In  1846,  also,  the  average  price  of  wheat  was  545.  Sd.,  the  price 
having  ruled  first  553.  6d.,  falling  to  465.  3d.  in  August,  and 
rising  to  6os.  7d.  in  November,  whilst  the  average  price  of  barley 
was  325.  8d.,  and  of  oats  235.  Sd.  But  in  1847  a  sudden  great 
rise  took  place.  The  price  of  wheat  rose  from  an  average  of  695. 
i  id.  in  January  to  an  average  of  925.  lod.  in  June ;  the  price  of 
barley  was  503.  2d.  in  January,  535.  5d.  in  February,  and  525. 
I  id.  in  May  and  June;  and  oats,  commencing  at  295.  6d.  in 
January  rose  to  345.  2d.  in  June.  In  July,  however,  a  sudden 
change  took  place  by  the  concurrent  action  of  large  importations 
and  excellent  prospects  of  the  approaching  harvest.  From  June 
to  December  wheat  fell  from  925.  lod.  to  525.  3d. ;  barley  from 
525.  i  id.  to  305.  9d. ;  and  oats  from  345.  2d.  to  2is.  lod.  per 
imperial  quarter.  The  importation  of  grain  had  never  been 
so  large  as  in  this  year.  In  former  years  1,000,000  or  2,000,000 
quarters  was  the  maximum,  but  in  1846  the  imports  amounted 
to  4,752,174  quarters  of  grain  and  meal,  and  in  1847  to  as  mucn 
as  11,912,864  quarters,  the  greatest  increase  having  taken  place 
from  Russia  and  America.  Then,  indeed,  the  nation  realized 
that  the  corn  law  could  not  be  maintained  any  longer.  Our 
dependence  on  foreign  grain  became  very  great,  and  thankful 
indeed  we  were  that,  by  the  wisdom  and  foresight  of  our  legis- 
lators, the  last  corn  law  and  the  navigation  law  were  alike  sus- 
pended, and  our  ports  were  opened  to  the  supply  of  food  from 
any  quarter  of  the  globe.  .  .  . 


THE  NEW   GOLD.  189 


X. 

THE    NEW  GOLD. 
FROM  CAIRNES'  ESSAYS  IN  POLITICAL  ECONOMY. 

ESSAY  II.  —  THE  COURSE  or  DEPRECIATION. 

No  one,  I  think,  who  has  attended  to  the  discussions  occasioned 
by  the  recent  gold  discoveries,  can  have  failed  to  observe,  on  the 
part  of  a  large  number  of  those  who  engage  in  them,  a  strange 
unwillingness  to  recognize,  amongst  the  inevitable  consequences 
of  those  events,  a  fall  in  the  value  of  money.  I  say,  a  strange  un- 
willingness, because  we  do  not  find  similar  doubts  to  exist  in  any 
corresponding  case.  With  respect  to  all  other  commodities,  it  is 
not  denied  that  whatever  facilitates  production  promotes  cheap- 
ness ;  that  less  will  be  given  for  objects  when  they  can  be  at- 
tained with  less  trouble  and  sacrifice:  it  is  not  denied,  e.g.,  that 
the  steam-engine,  the  spinning-jenny,  and  the  mule  have  lowered 
the  value  of  our  manufactures ;  that  railways  and  steamships 
have  lessened  the  expense  of  travelling,  or  that  the  superior  agri- 
cultural resources  of  foreign  countries,  made  available  through 
free-trade,  keep  down  the  price  of  our  agricultural  products.  It 
is  only  in  the  case  of  the  precious  metals  that  it  is  supposed  that  a 
diminution  of  cost  has  no  tendency  to  lower  value,  and  that,  how- 
ever rapidly  supply  may  be  increased,  a  given  quantity  will  con- 
tinue to  command  the  same  quantity  of  other  things  as  before. 

Amongst  pei'sons  unacquainted  with  economic  science,  the  prev- 
alence of  this  opinion  is  doubtless  principally  due  to  those  ambigu- 
ities of  language,  and  consequent  confusion  of  ideas,  with  which 
our  monetary  phraseology,  unfortunately,  abounds,  many  of  which 
tend  to  encourage  the  notion  of  some  peculiar  and  constant  sta- 
bility in  the  value  of  the  precious  metals.  Thus,  the  expression 
"  a  fixed  price  of  gold"  has  led  some  people  to  imagine  that  the 
possibility  of  a  depreciation  of  this  metal  is  precluded  by  our  mint 
regulations.  The  double  sense,  again,  of  the  phrase,  "value  of 
monev,"  has  countenanced  the  same  error ;  for  people,  perceiving 
the  rate  of  interest  (which  is  the  measure  of  the  value  of  money,  in 
one  sense  of  the  phrase)  remaining  high,  while  the  supply  of  gold 


190  SELECTIONS. 

was  rapidly  increasing,  —  perceiving  money  still  scarce  according 
to  this  criterion,  notwithstanding  the  increase  in  its  production,  — 
have  asked  whether  this  did  not  afford  a  presumption  that  its 
value  would  be  permanently  preserved  from  depreciation  ;  a  bank 
rate  of  discount  at  6,  8,  or  10  per  cent.,  as  they  remarked,  afford- 
ing small  indication  of  money  becoming  too  abundant. 

It  appears  to  me,  however,  that  misconceptions  respecting  the 
influence  of  an  increased  supply  of  gold  upon  its  value,  and  upon 
general  prices,  are  by  no  means  confined  to  the  class  who  could 
be  misled  by  such  fallacies,  but  that  even  among  economists  (at 
least  among  economists  in  this  country)  we  may  observe  the 
same  indisposition  to  believe  in  an  actual  and  progressive  depre- 
ciation of  this  metal.  It  is  not,  indeed,  denied  —  at  least,  I  pre- 
sume it  is  not  denied  — by  any  one  pretending  to  economic  knowl- 
edge, that  the  enlarged  production  of  gold  now  taking  place  has 
a  tendency  to  lower  its  value ;  but  it  seems  to  be  very  generally 
supposed  that  the  same  cause  —  the  increased  gold  production  — 
has  the  effect,  through  its  influence  on  trade,  of  calling  into  oper- 
ation so  many  tendencies  of  a  contrary  nature,  that,  on  the  whole, 
the  depreciation  must  proceed  with  extreme  slowness,  the  results 
being  dispersed  over  a  period  so  great  as  to  take  from  them  any 
practical  importance,  and  that,  at  all  events,  up  to  the  present 
time  no  sensible  effect  upon  prices  proceeding  from  this  cause  has 
become  perceptible. 

The  existence  of  this  opinion  among  economists  is,  I  apprehend, 
to  be  attributed  in  some  degree  to  the  circumstance  that  so  few 
have  taken  the  pains  to  compare  the  actual  prices  of  the  present 
time  with  those  of  the  period  previous  to  the  gold  discoveries,  but 
much  more  to  the  fact  that  the  character  of  the  new  agency  and 
the  mode  of  its  operation  are  not,  in  general,  correctly  conceived. 
I  believe  the  most  general  opinion  with  reference  to  the  action  of 
an  increased  supply  of  money  upon  its  value  is,  that  it  is  uniform, 
takes  place,  that  is  to  say,  in  the  same  degree  in  relation  to  all 
commodities  and  services,  and  that  therefore  prices,  so  far  as  they 
are  influenced  by  an  increase  of  money,  must  exhibit  a  uniform 
advance  ;l  and,  no  such  uniformity  being  observed  in  the  actual 

1 "  In  relation  to  the  Influence  of  the  gold  discoveries  on  the  prices  of  agricultural  produce, 
it  is  plain  that  it  could  be  only  the  same  upon  them  as  upon  those  of  any  other  class  of  com- 
modities.  If  it  has  caused  a  rise  ofiofer  cent,  in  th  fir  favor,  it  must  have  caused  a  rise  of 
30  per  cent,  in  everything  else,"  Times  City  article,  August  6,  1853.  And  the  same  as. 
sumption,  either  expressed  or  implied,  runs  through  most  of  the  reasoning  which  I  have 
seen  on  this  question. 


THE  NEW   GOLD.  191 

movement  of  prices,  the  inference  has  not  unnaturally  been 
drawn  that  such  enhancement  as  has  taken  place  is  not  due  to 
this  cause  ;  that  it  is  not  money  which  has  fallen,  but  commodities 
which  have  risen  in  value. 

Now  I  am  quite  prepared  to  admit  that  an  increase  of  money 
tends  ultimately,  where  the  conditions  of  production  remain  in 
other  respects  the  same,  to  affect  the  prices  of  all  commodities 
and  services  in  an  equal  degree  ;  but  before  this  result  is  attained 
a  period  of  time,  longer  or  shorter  according  to  the  amount  of  the 
augmentation  and  the  general  circumstances  of  commerce,  must 
elapse.  In  the  present  instance  the  additions  which  are  being 
made  to  the  monetary  systems  of  the  world  are  upon  an  enormous 
scale,  and  the  disturbance  effected  in  the  relation  of  prices  is  pro- 
portionally great.  Under  such  circumstances  it  is  very  possible 
that  the  inequalities  resulting  may  not  find  their  correction 
throughout  the  whole  period  of  progressive  depreciation ;  a 
period  which,  even  with  our  present  facilities  of  production  and 
distribution,  may  easily  extend  over  some  thirty  or  forty  years. 
During  this  transitionary  term  the  action  of  the  new  gold  will 
not  be  uniform,  but  partial.  Certain  classes  of  commodities  and 
services  will  be  affected  much  more  powerfully  than  others. 
Prices  generally  will  rise,  but  with  unequal  steps.  Nevertheless 
there  will  be  in  these  apparent  irregularities  nothing  either  capri- 
cious or  abnormal.  The  movement  will  be  governed  throughout 
its  course  by  economic  laws ;  and  it  is  the  purpose  of  the  present 
inquiry  to  ascertain  the  nature  of  these  laws  and  the  mode  of  their 
operation. 

The  process  by  which  an  increased  production  of  gold  operates 
in  depreciating  the  value  of  the  metal  and  raising  general  prices 
appears  to  be  twofold  :  it  acts,  first,  directly  through  the  medium 
of  an  enlarged  money  demand,  and  secondly,  indirectly  through 
a  contraction  of  supply.1 

When  an  increased  amount  of  money  comes  into  existence, 
there  is,  of  course,  an  increased  expenditure  on  the  part  of  those 
into  whose  possession  it  comes,  the  immediate  effect  of  which  is 
to  raise  the  prices  of  all  commodities  which  fall  under  its  influ- 
ence. It  is  obvious,  however,  that  the  advance  in  price  which 

i  According  to  Mr.  Newmarch  ("  History  of  Prices,"  vol.  vi.,  pp.  324-225)  the  depreciation 
of  money  may  occur  by  a  process  which  is  neither  of  these,  when  money  operates  upon 
prices  neither  through  demand  nor  yet  through  supply,  but  "  by  reason  of  augmented  quan- 
tity." I  must  confess  myself  wholly  unable  to  conceive  the  process  here  indicated. 


192  SELECTIONS. 

thus  occurs  will  be,  in  its  full  extent,  temporary  only ;  since  it  is 
immediately  followed  by  an  extension  of  production  to  meet  the 
increased  demand,  and  this  must  again  lead  to  a  fall  in  price. 
Some  writers  who  have  treated  this  question,  observing  this 
effect,  have  somewhat  hastily  concluded  that  under  the  operation 
of  this  principle  the  level  of  prices  would  never  permanently  be 
altered,  since,  as  they  have  urged,  each  addition  to  the  circulating 
medium  forming  the  basis  of  a  corresponding  increase  of  demand, 
gives  a  corresponding  impetus  to  production  ;  every  increase  of 
money  thus  calls  into  existence  an  equivalent  augmentation  in  the 
quantity  of  things  to  be  circulated ;  and  the  proportion  between 
the  two  not  being  ultimately  disturbed,  prices,  it  may  be  pre- 
sumed, will  return  to  their  original  level.1  The  least  reflection, 
however,  will  show  that  this  doctrine  has  been  suggested  by  a 
very  superficial  view  of  the  phenomena. 

For —  not  to  press  the  obvious  reductio  ad  absurdum  to  which 
this  argument  is  liable  —  how  is  this  extension  of  production  to  be 
carried  out?  In  the  last  resort  it  is  only  possible  through  a  more 
extended  employment  of  labor.  But,  when  once  all  the  hands  in 
a  community  are  employed,  the  effect  of  a  further  competition  for 
labor  can  only  be  to  raise  wages  ;  and,  wages  once  being  generally 
raised,  it  is  plain  (supposing  all  other  things  to  remain  the  same) 
that  profits  can  only  be  maintained  by  a  corresponding  elevation 
of  prices.  When,  therefore,  the  influence  of  the  new  money  has 
once  reached  wages,  it  is  evident  that  there  will  be  no  motive  to 
continue  production  to  that  point  which  would  bring  prices  to 
their  former  level,  and  that  consequently  an  elevation  of  price 
must,  at  this  stage  of  the  proceeding,  be  permanently  estab- 
lished. 

So  far  as  regards  articles  which  fall  directly  under  the  action 
of  the  new  money.  With  respect  to  those  which  do  not  happen 
to  come  within  the  range  of  the  new  demand,  price  is,  I  conceive, 
in  their  case  raised  by  an  indirect  action  of  the  new  money  in 
curtailing  supply. 

1  [It  may  be  worth  while  to  preserve  a  specimen  of  the  sort  of  Political  Economy  that  was 
talked  and  written  on  this  subject  some  fifteen  years  ago.  A  leading  article  in  the  Exam- 
iner (December  13,  1856)  contains  the  following :  "  The  additional  supply  of  the  precious 
metals  has  stimulated  the  industry  of  the  world,  and  in  fact  produced  an  amount  of  wealth 
in  representing  which  they  have  been  themselves,  as  it  were,  absorbed."  ..."  But  the 
produce  of  the  Australian  and  Californian  gold,  as  well  as  that  of  silver  which  has  accom- 
panied  it,  is  likely  to  go  on;  and  it  may  be  asked  if  this  must  not  in  course  of  time  produce 
depreciation.  We  think  it  certainly  is  not  likely  to  do  so;  .  .  .  on  the  contrary,  it  will 
surely  be  absorbed  by  increasing  wealth  and  population  as  fast  as  it  is  produced."  J 


THE  NEW   GOLD.  193 

We  have  seen  that  the  effect  of  the  efforts  to  extend  production 
in  the  directions  indicated  by  the  new  expenditure  must  be  to 
raise  wages ;  but  it  is  plainly  impossible  that  wages  should  con- 
tinue to  advance  in  any  of  the  principal  departments  of  industry 
without  affecting  their  rates  in  the  rest ;  whence  it  will  happen 
that,  under  the  operation  of  the  new  monetary  influence,  some  de- 
partments of  industry  will  experience  a  rise  of  wages  before  any 
advance  takes  place  in  the  prices  of  the  new  commodities  produced 
by  the  laborers  whose  wages  have  risen.  It  is  evident  that  in  all 
departments  of  industry  which  may  be  thus  affected  —  in  which 
prices  will  not  have  shared  the  advance  which  has  affected  wages 
—  profits  will  fall  below  the  general  average  ;  the  effect  of  which 
must  be  to  discourage  production  until,  by  a  contraction  in  the 
supply  of  the  articles  thus  furnished,  the  price  shall  be  raised  up 
to  that  point  which  will  place  the  producers  on  the  same  footing 
of  advantage  as  those  in  other  walks  of  industry. 

An  increased  supply  of  money  thus  tends,  by  one  mode  of  its 
operation,  to  raise  prices  in  advance  of  wages,  and  thus  to 
stimulate  production ;  by  another,  to  raise  wages  in  advance  of 
prices,  and  thus  to  check  it ;  in  both,  however,  to  raise  wages, 
and  thus  ultimately  to  render  necessary,  in  order  to  the  main- 
tenance of  profits,  a  general  and  permanent  elevation  of  price.1 

This  being  the  process  by  which  increased  supplies  of  money 
operate  in  raising  prices,  in  order  to  ascertain  the  laws  of  their 
advance  we  must  attend,  first,  to  the  direction  of  the  new  expen- 
diture ;  secondly,  to  the  facilities  for  extending  the  supply  of 
different  kinds  of  commodities ;  and,  thirdly,  to  the  facilities  for 
contracting  it. 

With  regard  to  the  first  point,  —  the  direction  of  the  new  ex- 
penditure,—  this  will  naturally  be  determined  by  the  habits  and 
tastes  of  the  persons  into  whose  possession  the  new  money  comes. 
These  persons  are  the  inhabitants  of  the  gold  countries,  and,  after 
them,  those  in  other  countries  who  can  best  supply  their  wants. 
Speaking  broadly,  we  may  say  that  the  persons  who  will  chiefly 

1  It  must  not  be  supposed  that  this  is  inconsistent  with  the  fundamental  doctrine  main- 
tained  by  Ricardo,  that "  high  wages  do  not  make  high  prices."  That  doctrine  assumes 
the  value  of  money  to  be  constant.  Ricardo  was  quite  aware  of  the  exception  to  the  general 
principle,  and  points  it  out  in  the  following  passage :  — 

"  Money,  being  a  variable  commodity,  the  rise  of  money  wages  will  be  frequently  occa- 
sioned by  a  fall  in  the  value  of  money.  A  rise  of  wages  from  this  cause  will,  indeed,  be 
invariably  accompanied  by  a  rise  in  the  price  of  commodities;  but  in  such  cases  it  will  be 
found  that  labor  and  all  commodities  have  not  varied  in  regard  to  each  other,  and  that  the 
variation  has  been  confined  to  money."  —  RICARDO'S  Works  (Second  Edition),  p.  31. 


194  SELECTIONS. 

benefit  by  the  gold  discoveries  belong  to  the  middle  and  lower 
ranks  of  society  ;  in  a  large  degree  to  the  lowest  rank,  the  class  of 
unskilled  laborers.  The  direction  of  the  new  expenditure  will 
consequently  be  that  indicated  by  the  habits  and  tastes  of  these 
classes,  and  the  commodities  which  will  be  most  affected  by  it 
will  be  those  which  fall  most  largely  within  their  consumption. 

With  respect,  secondly,  to  facilities  for  extending  supply,  these 
will  be  found  to  depend  principally  upon  two  circumstances : 
first,  on  the  extent  to  which  machinery  is  employed  in  produc- 
tion ;  and,  secondly,  on  the  degree  in  which  the  process  of  pro- 
duction is  independent  of  natural  agencies  which  require  time  for 
accomplishing  their  ends.  The  distinction  marked  by  these  two 
conditions,  it  will  be  found,  corresponds  pretty  accurately  with 
two  other  distinctions,  —  with  the  distinction,  namely,  between 
raw  and  manufactured  products  ;  and,  amongst  raw  products, 
with  that  between  those  derived  from  the  animaf  and  those 
derived  from  the  vegetable  kingdom.  An  article  of  finished 
manufacture,  in  the  production  of  which  machinery  bears  a  prin- 
cipal part,  and  which  is  independent,  or  nearly  so,  of  natural 
processes,  may  after  a  short  notice  be  rapidly  multiplied  to  meet 
any  probable  extension  of  demand.  An  article  of  raw  prod- 
uce, being  in  a  less  degree  under  the  dominion  of  machinery, 
and  depending  more  upon  natural  processes  which  require 
time  for  their  accomplishment,  cannot  be  increased  with  the 
same  facility ;  and  production  will  consequently,  in  this  case, 
be  comparatively  slow  in  overtaking  an  extension  of  demand. 
But  of  raw  products,  those  derived  from  the  animal  are  still 
less  under  the  dominion  of  machinery  than  those  derived 
from  the  vegetable  kingdom,  and  still  more  dependent  on 
the  slow  processes  of  nature,  and,  consequently,  production 
must,  in  their  case,  be  still  more  tardy  in  overtaking  demand. 
Supposing,  then,  the  extension  of  demand  to  be  in  all  three  cases 
the  same,  the  immediate  rise  of  price  will,  cceteris  paribus,  be  in 
all  the  same;  but  in  the  case  of  articles  of  finished  manufacture, 
this  rise  will  be  quickly  corrected  by  the  facilities  available  for 
increased  production,  while  in  raw  vegetable  products  the  correc- 
tion will  take  place  more  slowly,  and  in  raw  animal  products  more 
slowly  still.1 

i  The  following  passage  occurs  in  the  "  History  of  Prices,"  vol.  vi.,  p.  170:  "The  groups 
of  commodities  which  exhibit  the  most  important  instances  of  a  rise  of  price  are  the  raw 
materials  most  extensively  used  in  manufactures,  and  the  production  of  which  does  not 


THE   NEW    GOLD.  195 

But,  thirdly,  I  said  that  the  progress  of  prices  under  the  influ- 
ence of  the  gold  supplies  would  be  governed  by  the  facility  with 
which  supply  can  be  contracted.  Every  one  who  has  practical 
experience  of  manufacturing  operations  is  aware  that,  when  capi- 
tal has  once  been  embarked  in  any  branch  of  production,  it 
cannot  at  once  be  removed  to  a  different  one  the  moment  the 
needs  of  society  may  require  a  change  ;  whence  it  happens  that, 
on  any  sudden  change  taking  place  in  the  direction  of  a  nation's 
expenditure,  or  when  from  miscalculation  production  has  been 
extended  beyond  existing  wants,  producers  frequently  choose  to 
continue  their  business  at  diminished  profits  or  even  at  a  positive 
loss,  rather  than  incur  still  greater  damage  by  suffering  their 
capital  to  lie  idle,  or  by  attempting  to  transfer  it  suddenly  into 
some  new  branch  of  production.  The  supply  of  a  commodity  is 
not  therefore  always,  or  generally,  at  once  contracted  on  the 
demand  for  it  falling  off,  or  on  its  production  becoming  less  profit- 
able, and,  where  this  is  so,  it  is  evident  that  prices  must  at  times 
continue  depressed  below  the  normal  level ;  the  duration  of  the 
depression  depending  on  the  length  of  time  required  to  effect  a 
transference  of  the  unproductive  capital  to  some  more  lucrative 
investment.  Now,  the  difficulty  of  accomplishing  this  will  gener- 
ally be  in  direct  proportion  to  the  amount  of  fixed  capital  em- 
ployed ;  and  the  principal  form  in  which  fixed  capital  exists  is 
that  of  machinery.  It  is,  therefore,  in  articles  in  the  production 
of  which  machinery  is  extensively  employed  —  that  is  to  say, 
in  the  more  highly  finished  manufactures — that  the  contraction 
of  supply  will  be  most  difficult ;  and  this,  it  will  be  observed,  is 
also  the  kind  of  commodities  for  extending  the  supply  of  which  the 
facilities  are  greatest.  While,  therefore,  manufactured  articles 

admit  of  rapid  extension;  and,  second,  the  groups  of  commodities  in  which  there  is  little, 
if  any,  rise  of  price  in  1857,  as  compared  with  1851,  are  articles  of  colonial  and  tropical 
produce,  the  supply  of  which,  drawn  from  a  variety  of  sources,  does  admit  of  being 
considerably  and  expeditiously  enlarged."  The  fact  of  the  rise  of  price  in  raw  materials 
is  here  admitted,  though,  in  ascribing  that  rise,  as  by  implication  the  passage  does,  to  the 
paucity  of  the  sources  of  supply,  the  explanation  is,  as  I  conceive,  erroneous.  The  sources, 
e.g.,  from  which  tea  and  sugar  are  drawn  are  not  more  various  than,  nor  indeed  so  various 
as,  those  from  which  beef  and  mutton,  butter  and  provisions,  timber,  tallow,  and  leather 
are  drawn;  yet  all  these  latter  articles  have  very  considerably  advanced  in  price.  Again, 
amongst  colonial  and  tropical  produce  Mr.  Newmarch  includes  rum  and  tobacco,  and  he 
might  also  have  included  cotton;  yet  these  articles,  though  falling  within  the  class  which 
he  says  admits  of  being  expeditiously  enlarged,  and  which,  therefore,  according  to  his 
theory,  should  not  have  risen  in  price,  have  in  fact  risen  in  a  very  marked  manner.  It 
appears  to  me  that  these  phenomena  can  only  be  understood  by  reference  to  the  principle 
which  I  have  endeavored  to  explain  further  on — namely,  the  efficacy  of  the  currency  of 
different  countries  in  determining  local  prices. 


196  SELECTIONS. 

can  never  be  very  long  in  advance  of  the  general  movement  of 
prices,  they  may,  of  all  commodities,  be  the  longest  in  arrear 
of  it. 

The  operation  of  this  principle  will  be  shown  chiefly  in  that 
class  of  articles  which  feels  the  effect  of  the  new  gold  only  through 
its  indirect  action  —  that  is  to 'say,  through  its  action  upon  wages. 
With  respect  to  such  articles  there  is  no  extension  of  demand, 
and  the  price  consequently  can  only  be  raised  through  a  contrac- 
tion of  supply.  It  is  evident  that  of  all  commodities  this  is  the 
class  in  which  the  rise  of  price  must  proceed  most  slowly. 

From  the  foregoing  considerations,  then,  I  arrive  at  the  follow- 
ing general  conclusions  :  — 

First.  —  That  the  commodities,  the  price  of  which  may  be 
expected  first  to  rise  under  the  influence  of  the  new  money,  are 
those  which  fall  most  extensively  within  the  consumption  of  the 
productive  classes,  but  more  particularly  within  the  consumption 
of  the  laboring  and  artisan  section  of  these. 

Secondly.  —  That  of  such  commodities,  that  portion  which 
consists  of  finished  manufactures,  though  their  price  may  in  the 
first  instance  be  rapidly  raised,  cannot  continue  long  in  advance 
of  the  general  movement,  owing  to  the  facilities  available  for 
rapidly  extending  the  supply;  whereas,  should  the  production, 
from  over-estimation  of  the  increasing  requirements,  be  once 
carried  to  excess,  their  prices,  in  consequence  of  the  difficulty  of 
contracting  supply,  may  be  kept  for  some  considerable  time  below 
the  normal  level. 

Thirdly.  —  That  such  raw  products  as  fall  within  the  consump- 
tion of  the  classes  indicated,  not  being  susceptible  of  the  same 
rapid  extension  as  manufactures,  may  continue  for  some  time  in 
advance  of  the  general  movement,  and  that,  among  raw  products, 
the  effects  will  be  more  marked  in  those  derived  from  the  animal 
than  in  those  derived  from  the  vegetable  kingdom. 

Fourthly.  —  That  the  commodities  last  to  feel  the  effects  of  the 
new  money,  and  which  may  be  expected  to  rise  most  slowly  under 
its  influence,  are  those  articles  of  finished  manufacture  which  do 
not  happen  to  fall  within  the  range  of  the  new  expenditure  ;  such 
articles  being  affected  only  by  its  indirect  action,  and  this  action 
being  in  their  case  obstructed  by  impediments  to  the  contraction 
of  supply. 

This  is  one  class  of  laws  by  which  I  conceive  the  ascending 
movement  in  prices  will  be  governed  ;  and  up  to  this  point  1  have 


THE  NEW   GOLD.  197 

the  satisfaction  of  finding  my  conclusions  very  fully  corroborated 
by  the  independent  investigations  of  a  French  economist,  M. 
Levasseur,  who,  in  some  articles  lately  contributed  by  him  to  the 
Journal  des  Economistes,  has,  by  an  entirely  different  line  of  in- 
vestigation from  that  which  I  have  followed,  —  namely,  by  general- 
izing on  the  statistics  of  prices  in  France  during  the  period  of 
184710  1856.  —  arrived  at  conclusions  in  the  main  points  identical 
with  those  which- 1  have  now  advanced.1 

There  is,  however,  another  principle  to  which  I  venture  to  call 
attention,  which  has  not,  so  far  as  I  know,  been  noticed  by  any 
of  the  economists  who  have  treated  this  question,  but  which,  it 
appears  to  me,  must  exercise  a  powerful  influence  on  the  course 
of  the  movement.  The  principle  to  which  I  refer  is  that  efficacy 
which  resides  in  the  currency  of  each  country,  into  which  any 
portion  of  the  new  money  may  be  received,  for  determining  the 
effect  of  this  infusion  on  the  range  of  local  prices. 

It  is  evident  that  the  quantity  of  metallic  money  necessary  to 
support  anv  required  advance  of  prices  throughout  a  given  range 
of  business  will  vary  with  the  character  of  the  currency  into  which 
it  is  received  ;  that  the  quantity  required  will  be  greater  in  pro- 
portion as  the  metallic  element  of  the  currency  'is  greater ; 
and,  on  the  other  hand,  less  in  proportion  as  the  credit  ele- 
ment prevails.  If  the  currency  of  a  country  be  purely  metallic, 
a  given  addition  of  coin  will  increase  the  aggregate  medium 
of  exchange  in  that  country  only  by  the  same  amount ;  if,  on 
the  other  hand,  the  currency  consists  largely  of  credit  con- 
trivances, each  addition  to  its  coin  becomes  the  basis  of  a  new 
superstructure  of  credit  in  the  form  of  bank-notes  and  credits, 
bills  of  exchange,  checks,  etc.,  and  the  aggregate  circulation  is 
increased,  not  simply  by  the  amount  of  the  added  coin,  but  by  the 
extent  of  the  new  fabric  of  credit  of  which  this  coin  is  made  the 
foundation.  Applying  this  principle  to  the  different  countries  of 
the  world,  it  follows  that  a  given  addition  to  the  metallic  stock  of 
Great  Britain  or  the  United  States,  in  whose  monetary  systems 
credit  is  very  efficacious,  will  cause  a  greater  expansion  of  the 
total  circulation,  and  therefore  will  support  a  greater  advance  in 
general  prices,  than  the  same  addition  to  the  currency  of  countries 
like  France,  in  which  credit  is  less  active  ;  and  that,  again,  the 
effect  in  countries  like  France  will  be  greater  than  in  countries 

1  See  Cairnes,  Appendix,  p.  360,  for  a  summary  of  M.  Levasseur's  conclusions. 


198  SELECTIONS. 

like  India  or  China,  in  which  the  currencies  are  almost  purely 
metallic,  and  where  credit  is  comparatively  little  used. 

Now,  this  being  so,  if  we  consider  further  that  the  countries 
which  receive  in  the  first  instance  the  largest  share  of  the  new 
money  —  namely,  England  and  the  United  States  —  are  also  those 
in  which,  from  the  character  of  their  currencies,  a  given  amount 
of  coin  will  produce  the  greatest  effect ;  and,  on  the  other  hand, 
that  Asiatic  communities,  in  which,  from  the  weakness  of  the 
credit  element,  the  currencies  are  least  expansible,  receive  but  a 
small  portion  of  their  share  of  the  new  money  direct  from  the 
gold  countries ; 1  being  compelled  to  wait  for  the  remainder  till 
it  has  flowed  through  the  principal  markets  of  Europe  and 
America,  affecting  prices  in  its  transit ;  —  if,  I  say,  we  consider 
these  facts  in  connection  with  the  principle  to  which  I  have 
adverted,  I  think  we  must  recognize  in  that  principle  —  in  the 
influence  of  the  currency  of  each  country  on  the  range  of  its  local 
prices  —  an  agency  which  must  modify  in  no  small  degree  the 
general  character  of  the  movement  which  is  now  in  progi'ess. 

In  speaking  of  the  influence  of  the  currency  of  a  country  on  the 
range  of  its  local  prices,  I  should  explain  that  I  use  the  words 
"local  prices"  in  a  somewhat  restricted  sense;  namely,  with 
reference  to  the  locality  in  which  commodities  are  produced,  not 
to  that  in  which  they  are  sold,  their  price  in  the  latter  place  being 
always  determined  by  their  price  in  the  former.  Thus,  when  I 
speak  of  Australian,  English,  or  Indian  prices,  I  shall  be  under- 
stood to  mean  the  prices  of  their  several  products  in  Australia, 
England,  or  India. 

Understanding  the  words,  then,  in  this  sense,  let  us  see  how  far 
local  prices  are  likely  to  be  affected  by  the  cause  to  which  I  have 
adverted. 

In  the  first  place,  then,  let  it  be  observed  that  a  very  remarkable 
divergence  of  local  prices  from  the  range  previously  obtaining  in 


1  [From  statistics  recently  furnished  by  the  Economist,  I  learn  that  the  facts  have  not 
been  as  I  here  assumed,  at  least  since  1858  (the  date  from  which  full  returns  of  specie  im- 
ports have  been  published  by  the  Board  of  Trade) ;  and  it  is  probable  I  was  mistaken  in  my 
supposition  with  regard  to  what  had  occurred  before  that  time.  Since  1858,  of  ^90,000,000  of 
gold  received  and  retained  by  India  and  the  East,  some  .£49,000,000,  more  than  a  half  of  the 
whole,  appear  to  have  gone  there  directly  from  Australia,  the  remainder  only  having  come 
through  Europe.  This  error  as  to  matter  of  fact  will,  no  doubt,  affect  to  some  extent  the 
conclusion  contended  for.  The  causes  tending  to  a  divergence  of  European  from  Asiatic 
prices  have  not  been,  it  seems,  as  powerful  as  I  had  supposed;  and,  in  point  of  fact,  this 
feature  in  the  movement  has  been  less  marked  than  I  sketched  it;  but  for  this,  other  causes 
besides  that  noticed  here  have  been  responsible  (1872).  See  Introductory  Chapter,  p.  12.] 


THE  NEW   GOLD.  199 

the  international  scale  has  already  taken  place.1  The  prices  of  all 
articles  produced  in  Australia  and  California  are  at  present  on  an 
average  from  two  to  three  times  higher  than  those  which  prevailed 
previous  to  the  gold  discoveries  ;  these  rates  have  now  been  main- 
tained for  several  years,  and  are  likely  to  continue  ;  but,  while 
this  advance  has  taken  place  in  the  gold  countries,  in  no  part  of 
the  world  external  to  those  regions  have  prices  advanced  by  so 
much  as  one-third.  The  possibility  of  a  divergence  of  local  prices 
is  thus,  as  a  matter  of  fact,  established  ;  and  the  explanation  of 
the  phenomenon  I  take  to  be  this.  The  sudden  cheapening  of 
gold  in  Australia  and  California  quickly  led,  through  the  action 
of  competition  amongst  the  different  departments  of  industrv,  to 
a  corresponding  advance  in  the  prices  of  everything  produced  in 
those  countries ;  this  advance  being  in  their  case  possible, 
because,  from  the  limited  extent  of  the  transactions,  the  local 
circulation  was  quickly  raised  to  the  point  sufficient  to  sustain  a 
double  or  triple  elevation  ;  but  it  was  impossible  that  the  curren- 
cies of  all  countries  should  be  expanded  in  the  same  proportions  in 
the  same  time  ;  and,  consequently,  prices  in  other  countries  have 
not  risen  with  the  same  rapidity.  The  cause,  therefore,  of  this 
divergence  of  local  prices — the  circumstance  which  keeps  general 
prices  in  arrear  of  that  elevation  which  they  have  attained  in 
Australia  and  California  —  is  the  difficulty  of  expanding  the 
currencies  of  the  world  to  those  dimensions  which  such  an 
advance  would  require.  This  expansion,  however,  is  being 
gradually  effected  by  the  process  we  are  now  witnessing,  —  the 
increased  production  of  the  precious  metals,  and  their  diffusion 
throughout  the  world.  But,  as  I  have  said,  the  diffusion  is  not 
uniform  over  the  various  currencies,  nor  are  the  currencies  receiv- 
ing the  new  supplies  of  uniform  susceptibility ;  and  the  inequali- 
ties are  such  as  to  aggravate  each  other ;  the  currencies  which  are 
the  most  sensitive  to  an  increase  of  the  precious  metals  receiving 
in  the  first  instance  nearly  the  whole  of  the  new  gold  ;  while  the 
least  sensitive  currencies  are  the  last  to  receive  their  share.  And 
these,  it  appears  to  me,  are  grounds  for  expecting  amongst  other 
countries  further  examples  of  that  phenomenon  of  local  diver- 
gence, of  which  one  has  already  been  afforded  by  the  gold  coun- 
tries. 

To  judge,  however,  of  the  extent  to  which  such  local  variations 

1  See  Cairnes,  pp.  24,  25. 


20O  SELECTIONS. 

of  price  can  be  carried,  we  must  advert  to  the  corrective  influences 
which  the  play  of  international  dealings  calls  into  action  ;  and 
these  appear  to  me  to  resolve  themselves  into  the  two  following : 
namely,  first,  the  corrective,  which  is  supplied  by  the  competi- 
tion of  different  nations,  producers  of  the  same  commodities,  in 
neutral  markets ;  and,  secondly,  that  which  exists  in  the  recipro- 
cal demand  of  the  different  commercial  countries  for  each  other's 
productions. 

The  first  form  of  the  corrective  is  obviously  the  most  powerful, 
and  must,  so  far  as  its  operation  extends,  at  once  impose  a  check 
upon  any  serious  divergence.  Thus  it  is  evident  that  prices  in 
England  and  the  United  States  could  not  proceed  very  much  in 
advance  of  prices  on  the  continent  of  Europe,  since  the  certain 
effect  of  such  an  occurrence  would  be  to  send  consumers  from  the 
dearer  to  the  cheaper  markets,  and  thus  to  divert  the  tide  of  gold 
from  the  currencies  of  England  and  America  to  the  currencies  of 
France,  Germany,  and  other  continental  states,  —  a  process  which 
would  be  continued  until  prices  were  restored  to  nearly  the  same 
relative  level  as  before.  But  it  is  only  amongst  nations  which  are 
competitors  in  the  same  description  of  commodities  that  this 
equalizing  process  comes  into  operation :  as  between  countries 
like  England  and  America  on  the  one  hand,  and  India  and  China 
on  the  other,  —  in  which  the  climate,  soil,  and  general  physical 
conditions  differ  widely,  in  which,  consequently,  the  staple  indus- 
tries are  different,  and  whose  productions  do  not,  therefore,  come 
into  competition  in  the  markets  of  the  world,  — this  corrective  in- 
fluence would  be  felt  slightly  or  not  at  all.  The  only  check  which 
could  be  counted  on  in  this  case  would  be  that  far  weaker  one 
which  is  furnished  by  the  action  of  reciprocal  demand  in  inter- 
national dealings.  Thus,  supposing  prices  to  rise  more  rapidly 
in  England  than  in  India,  this  must  lead,  on  the  one  hand,  to  an 
increased  expenditure  in  England  on  Indian  commodities,  and,  on 
the  other,  to  a  diminished  expenditure  in  India  on  English  com- 
modities, with  this  result,  — a  steady  efflux  of  the  precious  metals 
from  the  former  to  the  latter  country.  Such  an  efflux,  as  com- 
mercial men  are  well  aware,  has  long  been  a  normal  phenomenon 
in  our  Eastern  trade,  but  it  has  lately  assumed  dimensions  which 
constitute  it  a  new  fact  needing  a  special  explanation.  I  believe 
that  explanation  is  to  be  found  in  the  circumstances  to  which  I  am 
calling  attention. 

English  and  American  prices,  and  with  them  money  incomes 


THE  NEW   GOLD.  2OI 

in  England  and  America,  have,  under  the  action  of  the  rjew  gold, 
been  advancing  more  rapidly  than  prices  and  incomes  in  Oriental 
countries  ;  and  the  result  has  been  a  change  in  the  relative  indebt- 
edness of  those  two  parts  of  the  world,  leading  to  a  transfer  to 
the  creditor  country  of  corresponding  amounts  of  that  material 
which  forms  the  universal  equivalent  of  commerce.  It  is  true, 
indeed,  that  other  causes  have  also  contributed  to  this  result,  and 
in  particular  I  may  mention  the  failure  of  the  silk  crop  in 
Europe,  which  has  largely  thrown  us  upon  China,  as  a  means 
of  supplementing  our  deficient  supplies.  But  the  main  cause  of 
the  phenomenon  in  its  present  proportions  is,  I  conceive,  to  be 
found,  not  in  any  such  mere  temporary  disturbances,  but  in  the 
natural  overflowing  (consequent  upon  the  increase  of  the  precious 
metals)  of  the  redundant  currencies  of  Europe  and  America  into 
the  more  absorbent  and  impassive  systems  of  Asia.1  This,  then, 
I  say,  is  the  only  substantial  corrective  afforded  to  the  advance  of 
prices  in  Europe  and  America  beyond  their  former  and  normal 
level  in  relation  to  prices  in  the  East ;  and  the  question  is,  will 
this  corrective  be  sufficient  to  neutralize  the  tendency  to  a  diver- 
gence? Will  the  flow  of  the  precious  metals  from  West  to  East 
suffice  to  keep  prices  in  England  and  America  within  the  range 
prescribed  by  the  inelastic  metallic  systems  of  Asia?  I  do  not 
conceive  that  the  corrective  will  be  adequate  to  this  end,  and  I 
rest  this  conclusion  upon  the  facts  and  principles  which  I  have 
stated, —  the  vast  proportion  of  the  whole  gold  production  which 
finds  its  way  in  the  first  instance  into  the  markets  of  England  and 
America,  the  comparatively  small  portion  which  goes  direct  to 
the  markets  of  Asia,2  the  highly  elastic  and  expansible  currencies 
of  the  former  countries,  and  the  extremely  impassive  and  inex- 
pansible  currencies  of  the  latter. 

We   find,  therefore,  two  sets  of  laws  by  which  the  progress  of 
prices,  or   (which  comes  to   the  same  thing)  the  depreciation  of 

1  Accordingly  we  find  that  the  drain  which,  during  the  revulsion  of  trade  following  on 
the  commercial  crisis  of  1857,  had  for  a  while  ceased,  has,  with  the  revival  of  trade,  recom- 
menced.    As  a  proof  how  little  mere  practical  sagacity  is  to  be  trusted  in  a  question  of  this 
kind,  it  may  be  worth  while  to  mention  that,  only  three  months  since,  mercantile  writers 
were  confidently  predicting  the  turning  of  the  tide  of  silver  from  the  East  to  England, 
The  following  is  from  a  circular  of  Messrs.  Ellisen  &  Co.,  quoted  in  the  Times  City  article, 
July  28,  1858,  apparently  with  the  editor's  approval:    "The  time  is  rapidly  approaching 
when  silver  will  also  be  shipped  from  here  [China]  to  England."   So  far  from  this  being  the 
case,  the  drain  to  the  East  has  again  set  in,  and  gives  every  indication  of  assuming  its 
former  dimensions.     Every  mail  to  India  during  the  present  month  (November,  1858)  has 
taken  out  large  amounts  of  silver. 

2  See  ante,  p.  198,  note. 


2O2  SELECTIONS. 

gold  under  the  action  of  an  increased  supply,  is  regulated  :  first, 
those  which  I  explained  in  the  earlier  portion  of  this  paper,  which 
depend  chiefly  on  the  facility  with  which  the  supply  of  com- 
modities can  be  adjusted  to  such  changes  in  demand  as  the  new 
money  expenditure  may  occasion  ;  and,  secondly,  those  which 
result  from  the  action  of  the  new  money  on  the  curi'encies  into 
which  it  is  received.  According  to  the  former  principle,  the  rise 
in  price  follows  the  nature  of  the  commodity  affected  ;  thus  it  will 
in  general  be  greater  in  animal  than  in  vegetable  productions  — 
in  raw  produce  than  in  finished  manufactures.  According  to  the 
latter  principle,  the  advance  follows  the  economic  conditions  of 
the  locality  in  which  the  commodity  is  produced.  Thus  the  rise 
in  price  has  been  most  rapid  in  commodities  produced  in  the  gold 
countries ;  having  in  these  at  a  single  bound  reached  its  utmost 
limit,  —  the  limit  set  by  the  cost  of  procuring  gold.  After  com- 
modities produced  in  the  gold  regions,  the  advance  I  conceive  will 
proceed  most  rapidly  in  the  productions  of  England  and  the  United 
States  ;  after  these,  at  no  great  interval,  in  the  productions  of  the 
continent  of  Europe  ;  while  the  commodities  the  last  to  feel  the 
effects  of  the  new  money,  and  which  will  advance  most  slowly 
under  its  influence,  are  the  productions  of  India  and  China,  and, 
I  may  add,  of  tropical  countries  generally,  so  far  as  these  share, 
as  regards  their  economic  conditions,  the  general  character  of  the 
former  countries. 

Such  appear  to  be  the  general  principles  according  to  which 
a  depreciation  of  the  precious  metals,  under  the  action  of  an 
increased  supply,  tends  to  establish  itself.  With  a  view  to  ascer- 
tain how  far,  in  the  progress  of  prices  up  to  the  present  time 
(1858),  any  trace  of  their  operation  can  be  discerned,  I  have 
drawn  up  some  statistical  tables ; 1  and  although,  from  the  imper- 
fect nature  of  the  materials  which  I  have  been  able  to  collect,  I 
cannot  claim  for  the  result  a  complete  verification  of  the  theoretic 
conclusions  which  I  have  ventured  to  advance,  I  think  they  are  such 
as  to  justify  me  in  placing  some  confidence  in  the  general  sound- 
ness of  those  views.  Before,  however,  stating  the  results  of  the 
tables,  two  or  three  remarks  must  be  premised. 

First,  I  would  crave  attention  to  this  fact,  that  the  present  time 
[1858]  is  one  singularly  free  from  disturbing  influences,  and  that 
such  as  do  exist  are  of  a  kind  rather  to  conceal  than  exaggerate 

1  See  Cairnes,  Appendix. 


THE  NEW   GOLD.  203 

the  effects  of  depreciation.  Thus,  we  have  had  three  harvests  in 
succession  of,  I  believe,  more  than  average  productiveness  (the 
last  year  of  deficiency  being  1855)  ;  and  this  cause  of  abundance 
has  been  assisted  by  free-trade,  which  has  opened  our  ports  to  the 
produce  of  all  quarters  of  the  world.  Again,  although  in  the 
period  under  review  we  have  passed  through  a  European  war,  yet 
we  have  now  enjoyed  two  years  and  a  half  of  peace,  during  which, 
I  think,  the  economic  influences  of  the  war  may  be  taken  to  have 
exhausted  themselves.  It  is  true,  indeed,  that  we  have  an  Indian 
revolt  still  on  our  hands,  besides  having  but  just  concluded  some 
hostile  operations  in  China.  But  these  disturbances  have  not  been 
of  a  kind  to  interfere  seriously  with  the  general  course  of  trade, 
except  in  some  few  Oriental  commodities  in  which  their  effects 
are  slightly  apparent. 

But  what  renders  the  present  time  peculiarly  important  as  a 
point  of  comparison  with  former  periods,  is  its  being  in  immediate 
sequence  to  a  severe  commercial  crisis.  The  effect  of  the  crisis 
of  last  winter  has  been  effectually  to  eliminate  one  great  disturb- 
ing element  from  those  causes  to  which  a  rise  of  price  might  be 
attributed,  —  the  element  of  credit.  Trade  is  now  suffering 
depression  in  almost  all  its  branches  ;  and  prices,  after  a  period 
of  undue  inflation,  have,  through  an  ordeal  of  bankruptcy,  been 
brought  to  the  test  of  real  value.  In  the  fluctuations  of  commerce 
we  have  reached  the  lowest  point  of  the  wave  ;  whatever,  there- 
fore, be  the  range  of  prices  at  the  present  time,  we  may  at  least 
be  sure  that  no  commercial  convulsion  is  likely  to  lower  it. 

We  have  further  to  remember  that  in  an  age  like  the  present, 
in  which  science  and  its  applications  to  the  arts  are  in  all  civilized 
countries  making  rapid  strides,  there  exists  in  most  articles  of 
general  consumption  (but  more  particularly  in  the  more  finished 
manufactures)  a  constant  tendency  to  a  decline  of  price,  through 
the  employment  of  more  efficient  machinery  and  improved  pro- 
cesses of  production.  Now,  taking  all  these  circumstances  to- 
gether, —  the  propitiousness  of  the  seasons,  the  action  of  free- 
trade,  the  absence  of  war,  the  contraction  of  credit,  and  the 
general  tendency  to  a  reduction  of  cost  proceeding  from  the 
progress  of  knowledge,  —  it  appears  to  me  that,  were  there  no 
other  cause  in  operation,  we  should  have  reason  to  look  for  a  very 
considerable  fall  of  prices  at  the  present  time,  as  compared  with, 
say,  eight  or  ten  years  ago.  Prices,  however,  as  the  following 
tables  will  show,  have  not  fallen ;  they  have,  on  the  contrary, 


204  SELECTIONS. 

very  decidedly  risen,  and  the  advance  has,  moreover,  as  the  same 
tables  will  also  show,  on  the  whole  proceeded  in  conformity  with 
the  principles  which  I  have  in  this  paper  endeavored  to  establish. 
And  this  is  my  ground  for  asserting  that  the  depreciation  of  our 
standard  money  is  already,  under  the  action  of  the  new  gold,  an 
accomplished  fact. 

ESSAY  III.  —  INTERNATIONAL  RESULTS.! 

In  a  former  essay2  it  was  attempted,  from  a  review  of  the  in- 
dustrial history  of  Australia  since  the  late  discovery  of  gold,  to 
make  some  general  deductions  respecting  the  character  of  that 
event,  and  of  its  influence  upon  national  interests.  Among  other 
conclusions  it  was  maintained  that  the  tendency  of  the  gold  dis- 
coveries, or,  to  speak  with  more  precision,  the  tendency  of  the 
increased  production  of  gold,  was  rather  to  alter  the  distribution 
of  real  wealth  in  the  world  than  to  increase  its  amount ;  the  bene- 
fit derived  by  some  countries  and  classes  from  the  event  being  for 
the  most  part  obtained  at  the  expense  of  others.  It  was  shown, 
for  example,  that  the  gain  to  Australia  and  California  from  their 
gold-fields  accrued  to  them  exclusively  through  their  foreign  trade, 
—  their  cheap  gold  enabling  them  to  command  on  easier  terms 
than  formerly  all  foreign  productions ;  while,  on  the  other  hand, 
the  only  result  to  foreign  nations  of  the  traffic  thence  arising  was 
an  increase  in  their  stock  of  money, —  a  result  rendered  necessary 
indeed  by  the  new  conditions  of  raising  gold  introduced  by  the 
gold  discoveries,  but  in  itself  destitute  of  any  real  utility.  It  was 
shown,  in  short,  that,  as  regards  commercial  nations,  the  effect  of 
the  gold  discoveries  was  to  place  them  under  the  necessity  of 
enlarging  their  currencies,  compelling  them  to  pay  for  the  requi- 
site increase  by  an  increased  export  of  their  productions. 

To  this  conclusion  I  was  led  by  direct  inference  from  the  facts 
presented  in  the  gold  countries.  In  the  present  paper  it  is  pro- 
posed to  follow  up  the  inquiry,  with  a  view  to  a  more  particular 
ascertainment  of  the  consequences  formerly  described  ;  the  object 
being  to  discover  in  what  manner  the  loss  arising  from  the  gold 
movement  is  likely  to  be  distributed  among  commercial  nations, 
and  how  far  this  loss  may  in  particular  cases  be  neutralized  or 
compensated  by  other  influences  which  the  same  movement  may 
develop. 

1  Eraser's  Magazine,  January,  1860.  2  Essay  I.  of  this  Series. 


THE   NEW   GOLD.  2O$ 

In  the  discussions  which  have  hitherto  taken  place  upon  this 
question,  the  inquiry  into  the  consequences  of  the  gold  discoveries 
has  been  confined  almost  exclusively  to  that  aspect  of  the  event 
in  which  it  is  regarded  as  affecting  fixed  contracts  through  a  de- 
preciation of  the  monetary  standard.1  As  soon  as  the  probability  of 
depreciation  is  settled,  and  the  effects  of  this  upon  the  different 
classes  of  society,  according  as  they  happen  to  be  debtors  or  cred- 
itors under  fixed  contracts,  explained,  the  subject  for  the  most  part 
is  considered  as  exhausted.  I  venture,  however,  to  think  that  this 
mode  of  treatment  is  very  far  from  exhausting  the  question.  It 
seems  to  me  that,  independently  altogether  of  the  existence  of  fixed 
contracts,  independently  even  of  gold  being  a  standard  of  value,  the 
increased  production  of  this  metal  which  is  now  taking  place  will 
be  attended  —  indeed  has  already  been  attended  —  with  very  im- 
portant results.  Let  us  observe  for  a  moment  the  movement 
which  is  now  in  progress.  Australia  and  California  have,  during 
the  last  eight  or  ten  years,  sent  into  general  circulation  some  two 
hundred  millions  sterling  of  gold.  Of  this  vast  sum  portions 
have  penetrated  to  the  most  remote  quarters  of  the  world  ;  but 
the  bulk  of  it  has  been  received  into  the  currencies  of  Europe  and 
the  United  States,  from  which  it  has  largely  displaced  the  silver 
formerly  circulating;  the  latter  metal,  as  it  has  become  free,, 
flowing  oft'  into  Asia,  where  it  is  permanently  absorbed.  View- 
ing the  effect  as  it  occurs  in  the  mass  of  the  two  metals  combined, 
it  may  be  said  that  the  stream  which  rises  in  the  gold  regions  of 
Australia  and  California  flows  through  the  currencies  of  the 
United  States  and  Europe,  and,  after  saturating  the  trade  of  these 
countries,  finally  loses  itself  in  the  hoards  of  China  and  Hindo- 
stan.  The  tide  which  comes  to  light  in  the  sands  and  rocks  of  the 
auriferous  regions  disappears  in  the  accumulations  of  the  East. 
In  conjunction,  however,  with  this  movement,  there  has  been  a 
counter  one.  With  every  advance  in  the  metallic  tide,  a  stream 
of  commodities  has  set  in  in  the  opposite  direction  along  the  same 
course,  —  a  stream  which,  issuing  from  the  ports  of  Europe, 
America,  and  Asia,  and  depositing  as  it  proceeds  a  portion  of  the 
wealth  with  which  it  is  charged,  finds  its  termination  in  the 

1  See  Stirling's  "  Gold  Discoveries  and  their  probable  Consequences;  "  Chevalier  "  On 
the  Probable  Fall  in  the  Value  of  Gold ; "  Levasseur's  contributions  to  the  Journal  des 
tconomistes,  1858;  M'Culloch's  article  "  Precious  Metals,"  in  the  "  Encyclopaedia  Britan- 
nica."  In  all  these,  and  in  many  other  minor  productions  on  the  same  subject,  almost  the 
only  consequences  of  the  gold  discoveries  which  are  taken  account  of  are  those  which  occur 
in  fixed  contracts  through  a  depreciation  of  the  standard. 


206  SELECTIONS. 

markets  of  the  gold  countries.  Here,  then,  we  find  a  vast  dis- 
turbance in  the  conditions  of  national  wealth,  —  a  disturbance 
originating  in  the  gold  discoveries,  and  resulting  in  a  transfer,  on 
an  enormous  scale,  of  consumable  goods,  —  the  means  of  well- 
being —  from  one  side  of  the  globe  to  the  other.  This  disturbance, 
it  is  evident,  is  entirely  independent  of  the  accident  that  gold 
happens  to  be  in  some  countries  a  standai'd  of  value,  as  well  as 
of  the  existence  of  fixed  money-contracts  ;  for  it  includes  within 
the  range  of  its  influence  countries  in  which  gold  is  not,  no  less 
than  those  in  which  it  is,  the  monetary  standard ;  and  it 
affects  alike  persons  whose  bargains  are  made  from  day  to 
day,  and  those  who  engage  in  contracts  extending  over  cen- 
turies. The  fact  is,  the  movement  in  question  is  the  result  not 
of  gold's  being  a  standard  of  value,  but  of  its  being  a  source  of 
purchasing  power ;  and  the  influence  of  the  gold  discoveries  hav- 
ing been  hitherto  regarded  almost  exclusively  with  reference  to 
the  former  function,  the  vast  effects  which  they  are  producing 
through  the  action  of  the  latter  —  that  is  to  say,  by  altering  the 
distribution  of  purchasing  power  in  the  world  —  have  been 
almost  wholly  overlooked.  It  has  indeed  been  perceived  that  a 
great  influx  of  the  precious  metals  is  taking  place,  accompanied 
with  certain  consequences  on  the  trade  of  the  world  ;  but  so  far  as 
I  know,  beyond  some  general  phrases  respecting  the  stimulus 
given  to  production  by  an  increase  of  money,  and  the  great  de- 
velopment of  commerce  which  it  is  causing,  no  attempt  has  yet 
been  made  to  state  the  principles  by  which  the  movement  is 
governed,  or  the  effects  which  may. flow  from  it.  It  is  to  these 
questions,  then,  that  I  would  now  solicit  the  reader's  attention, 
and  towards  their  solution  the  following  remarks  are  offered  as  a 
contribution. 

Those  who  have  followed  the  course  of  this  controversy  are 
aware  that,  by  most  persons  who  have  taken  part  in  it,  it  has  been 
assumed,  almost  as  an  axiom,  that  no  depreciation  of  gold  in  con- 
sequence of  the  gold  discoveries  has,  up  to  the  present  time,  taken 
place.1  As  a  matter  of  fact,  however,  we  know  that  the  gold 
prices  of  all  commodities  produced  in  Australia  and  California 

JThe  principal  exceptions  to  this  statement  are  M.  Levasseur  (who,  in  an  article  in  the 
Journal  des  ficonomistes,  March,  1858,  estimates  the  rise  of  prices  in  France  since  1847  at 
zo  per  cent,  on  all  commodities),  and  Dr.  Soetbeer,  of  Hamburg,  who,  in  his  table  of  prices 
given  in  his  "  Contributions  to  the  Statistics  of  Prices  in  Hamburg,"  arrives  at  a  similar 
result  (see  Appendix).  Many  other  writers,  indeed,  acknowledge  that  prices  have  risen, 
but  the  rise  is  always  attributed  to  causes  distinct  from  the  increased  production  of  gold. 


THE  NEW   GOLD.  2O/ 

have  risen  in  at  least  a  twofold  proportion  ; 1  while  we  have  seen 
that  (so  long  as  the  conditions  of  producing  gold  remain  as  at 
present)  this  rise  must  be  permanent.  To  express  the  same  thing 
differently:  —  in  the  purchase  of  every  commodity  raised  in  the 
gold  countries  two  sovereigns  are  now  required,  and  (the  above 
conditions  being  fulfilled)  will  continue  to  be  required,  where  one 
was  formerly  sufficient ;  and  if  this  does  not  amount  to  a  fall  in  the 
value  of  gold,  I  must  confess  myself  unable  to  understand  the 
meaning  of  that  expression.  It  is  not  to  be  supposed  that  so  re- 
markable a  fact  as  this  should  have  escaped  the  attention  of  those 
who  have  written  on  this  question  ;  it  seems  to  me  rather  that  the 
ignoring  of  it  in  the  discussion  is  to  be  attributed  to  a  want  of 
definite  ideas  respecting  value  in  the  precious  metals,  as  well  as 
respecting  the  mode  in  which  changes  in  their  value  are  accom- 
plished. The  language  which  is  commonly  used  on  the  subject 
would  seem  to  imply  that  gold  and  silver  possess  throughout  the 
world  a  uniform  value,  and  that  all  changes  therein  proceed  in  a 
uniform  manner,  showing  themselves  at  the  same  time  in  all 
countries,  and  in  respect  to  all  commodities.  But  nothing  can 
be  further  from  the  truth  than  such  a  notion.  Gold  and  silver, 
like  all  other  things  which  are  the  subjects  of  international  ex- 
change, possess  local  values  ; 2  and  it  is  by  a  succession  of  opera- 
tions on  the  local  values  of  gold  of  an  unequal  and  fluctuating 
character,  that  its  depreciation  is  being  effected,  and  that  (the 
conditions  of  production  remaining  as  at  present)  its  value  will 
continue  to  decline.  The  twofold  rise  of  prices  in  the  gold 
countries  forms  the  first  step  in  this  progress ;  and  it  will  be 
through  a  series  of  similar  partial  advances  in  other  countries,  and 
not  by  any  general  movement,  that  the  depreciation  of  the  metal 
throughout  the  world  will  be  accomplished,  if  that  consummation 
is  indeed  to  take  place.  With  the  question  of  depreciation,  how- 
ever, I  am  at  present  no  further  concerned  than  may  be  necessary 
to  show  the  bearing  of  these  changes  in  the  local  values  of  gold 
upon  the  movements  of  trade,  and,  through  these,  upon  national 
interests. 

There  is  no  need  here  to  resort  to  argument  to  prove  that  a 
general  rise  or  a  general  fall  of  prices,  provided  it  be  simultaneous 
and  uniform,  can  be  attended  —  always  excluding  the  case  of 

1  See  Cairnes,  p.  24. 

2  See  on  the  subject  of  the  local  values  of  the  precious  metals,  Ricardo's  "  Works,"  pp. 
77-86,  and  Mill's  "Principles  of  Political  Economy,"  Book  iii.,  chaps,  xix.  and  xxi. 


208  SELECTIONS. 

fixed  incomes  and  contracts  already  entered  into  — with  no  im- 
portant consequences  either  to  nations  or  to  individuals.  It  is 
evident  that  such  a  change  would  merely  alter  the  terms  in  which 
transactions  are  carried  on,  not  the  transactions  themselves.  But 
when  the  rise  or  fall  of  prices  is  not  general, —  in  other  words, 
when  the  change  in  the  values  of  the  precious  metals  is  merely 
local,  —  it  will  be  seen  that  important  consequences  must  result. 
Supposing,  e.g.,  the  prices  of  all  commodities  produced  in  Eng- 
land to  be  doubled,  while  prices  throughout  the  rest  of  the  world 
remained  unchanged,  it  is  evident  that  half  the  commodities  ex- 
ported from  England  would,  under  these  circumstances,  be 
sufficient  to  discharge  our  foreign  debts.  With  half  the  capital 
and  labor  now  employed  in  pix>ducing  goods  for  the  foreign 
markets,  we  should  attain  the  same  result  as  at  present,  —  the  pro- 
curing of  our  imports  ;  while  the  remaining  half  would  be  set 
free  to  be  applied  to  other  purposes,  —  to  the  further  augmentation 
of  our  wealth  and  well-being.  England  would,  therefore,  in  the 
case  we  have  supposed,  be  benefited  in  all  her  foreign  dealings  to 
the  full  extent  of  the  rise  in  price.  On  the  other  hand,  foreign 
countries  would,  in  exchange  for  the  commodities  which  they 
send  us,  receive  in  return  of  our  commodities  but  half  their  present 
supply.  Their  labor  and  capital  would  go  but  half  as  far  as  at 
present  in  commanding  our  productions,  and  they  would  be  losers 
in  proportion.  It  is  evident,  therefore,  that  while  nations  have 
not,  any  more  than  individuals,  any  interest  in  the  positive  height 
which  prices  may  attain,  every  nation,  as  well  as  every  individual 
trader,  is  interested  in  raising,  in  relation  to  others,  the  price  of 
its  own  productions.  The  lower  the  local  value,  therefore,  of  the 
precious  metals  in  any  country,  the  greater  will  be  the  advantage 
to  that  country  in  foreign  markets. 

This  being  the  manner  in  which  nations  are  interested  in 
changes  in  the  value  of  gold,  let  us  now  observe  the  effect  which 
the  gold  discoveries  are  producing  in  this  respect.  As  has  been 
already  stated,  the  local  value  of  gold  in  Australia  and  California 
has  fallen  to  one-half,  —  the  prices  of  their  productions  having 
risen  in  a  twofold  proportion  ; 1  and  prices  in  other  parts  of  the 

1  This  statement  is  not  given  as  strictly  accurate.  On  the  whole,  the  advance  of  local 
prices  in  the  gold  countries  is  at  present  (1859)  considerably  more  than  this,  some  leading 
articles,  as  house-rent,  meat,  etc.,  having  risen  in  a  fourfold  proportion  and  upwards.  I 
adopt  the  proportion  of  two  to  one,  because  money  wages  have  risen  in  about  this  ratio, 
and  money  wages,  under  a  depreciation  of  the  precious  metals,  ultimately  govern  money 
prices. 


THE  NEW   GOLD.  2OQ 

world  having  undergone  no  corresponding  change,  these  countries 
realize  the  position  which  we  have  just  been  considering  in  our 
hypothetical  case.  A  given  quantity  of  their  capital  and  labor 
goes  twice  as  far  as  formerly  in  commanding  foreign  productions, 
while  a  given  quantity  of  foreign  labor  and  capital  goes  only  one- 
half  as  far  in  commanding  theirs.  The  world  has  thus,  through 
the  gold  discoveries,  been  placed  in  its  dealings  with  California 
and  Australia  at  a  commercial  disadvantage  ;  and  from  this  dis- 
advantage it  can  only  escape  (always  supposing  the  present  con- 
ditions of  producing  gold  to  continue)  by  raising  the  prices  of  its 
productions  in  a  corresponding  degree.  Every  country,  therefore, 
is  interested  in  raising  as  rapidly  as  possible  the  prices  of  its 
productions,  —  in  other  words,  in  the  most  rapid  possible  depre- 
ciation in  the  local  value  of  its  gold.1  The  sooner  this  is  effected, 
the  sooner  will  the  country  be  restored  to  its  natural  commercial 
footing  in  relation  to  Australia  and  California  ;  while  in  relation 
to  countries  where  prices  do  not  rise  with  the  same  rapidity,  it 
will  possess  the  same  kind  of  advantage  which  is  now  enjoyed  by 
the  gold  countries. 

This  conclusion,  I  find,  is  directly  at  variance  with  the  opinion 
of  some  economists  of  eminence.  Mr.  M'Culloch,  for  example, 
in  his  recent  contribution  to  the  "Encyclopaedia  Britannica,"2 
maintains  "that  the  mischievous  influence  resulting  from  a  fall 
in  the  value  of  the  precious  metals  depends  in  a  great  measure  on 
the  rapidity  with  which  it  is  brought  about."  But  I  apprehend 
the  difference  between  Mr.  M'Culloch  and  myself  arises  from  his 
attending  exclusively  to  a  single  class  of  consequences, — those, 
namely,  which  result,  in  the  case  of  fixed  contracts,  from  a  de- 
preciation of  the  standard.  With  respect  to  this  class  of  effects, 
it  is  quite  true  that  the  evils  which  they  involve  will  be  increased 
by  the  rapidity  of  the  depreciation  ;  but  as  I  have  shown,  the  new 
gold  is  producing  effects  quite  independently  of  its  operation  upon 
fixed  contracts  ;  and  it  is  to  those  other  effects  that  the  statement 
I  have  just  made  is  intended  to  apply.  The  distinction  which  I 
have  in  view  will  be  best  exemplified  by  recurring  to  the  experi- 
ence of  the  gold  countries.  In  these  the  value  of  gold  fell  by  more 
than  50  per  cent,  in  a  single  year,  the  depreciation  involving  a 


1  For  the  general  ground  of  this  assertion  the  reader  is  referred  to  Mr.  Mill's  chapters  on 
nternational  Values,  and  on  Money  as  an  Imported  Commodity,  in  his  "  Principles  of 
'olitical  Economy;  "  also  to  Mr.  Senior's  Essay  "  On  the  Cost  of  Obtaining  Money." 

2  Article  "Precious  Metals." 


2IO  SELECTIONS. 

proportional  loss  to  creditors  with  a  corresponding  gain  to  debtors, 
and  entailing  in  addition  those  numerous  incidental  evils  which 
always  result  from  a  sudden  disturbance  of  social  relations.  No 
one,  however,  on  this  account,  will  say  that  the  sudden  deprecia- 
tion of  gold  in  Australia  and  California  was  not  for  these  countries 
a  great  gain.  The  nature  and  extent  of  that  gain  I  endeavored  on 
a  former  occasion  to  estimate.1  It  consisted,  as  I  showed,  in  the 
increased  command  conferred  by  the  cheapness  of  their  gold  over 
markets  in  which  gold  prices  had  not  proportionally  risen.  With 
every  rise  in  the  price  of  Australian  and  Californian  products, 
or,  what  comes  to  the  same  thing,  with  every  fall  in  the 
local  value  of  their  gold,  their  power  of  purchase  in  foreign 
markets  increased,  —  an  increase  of  purchasing  power  which,  as 
we  know,  was  immediately  followed  by  a  sudden  and  extraordi- 
nary influx  of  foreign  goods.  Now,  precisely  the  same  principle 
applies  in  the  case  of  other  countries.  A  fall  in  the  value  of  gold 
will,  where  gold  is  the  standard,  lead  to  a  disturbance  in  fixed 
contracts,  with  the  concomitant  evils  ;  but  it  will  at  the  same 
time,  as  in  the  case  just  considered,  place  the  countries  in  which 
it  occurs  in  a  better  position  commercially  in  the  markets  of  the 
world.  Supposing,  e.g.,  a  rise  in  prices  to  take  place  in  all  com- 
mercial countries  equivalent  to  that  which  has  occurred  in  Cali- 
fornia and  Australia,  the  consequence  would  be  what  I  endeavored 
to  explain  in  the  paper  just  referred  to  ;  the  export  of  gold  from 
California  and  Australia,  at  least  on  its  present  scale,  would  at 
once  cease,  and  the  world  would  receive  instead  an  increased 
supply  of  agricultural  and  pastoral  products,  and  of  other  com- 
modities which  those  countries  are  fitted  to  produce,  —  a  result 
which,  I  ventured  to  think,  would  be  a  gain  for  the  world.  *  On  the 
other  hand,  supposing  the  rise  in  price  to  be  confined  to  a  single 
country,  —  say  to  England, — then  England  would  at  once  be 
placed  on  a  footing  of  commercial  equality  with  California  and 
Australia,  while  as  regards  other  countries  she  would  occupy  the 
same  vantage-ground  which  California  and  Australia  now  possess. 
She  would,  in  short,  obtain  her  gold  at  half  its  present  cost  (for 
she  would  receive  twice  as  much  as  at  present  in  return  for  the 
same  expenditure  of  labor  and  capital),  while  the  gold  thus 
obtained  would  be  expended  on  foreign  commodities  of  which, 
according  to  the  hypothesis,  the  prices  had  not  risen.  Notwith- 

1  See  Cairnes,  p.  39. 


THE  NEW   GOLD.  211 

standing,  therefore,  the  evils  which  undoubtedly  attend  variations 
in  the  standard  of  value,  more  especially  in  an  old  and  highly 
artificial  community  like  ours,  it  is  nevertheless,  I  maintain,  for 
the  interest  of  every  country,  that,  a  fall  in  the  cost  of  gold  hav- 
ing been  effected,  the  progress  of  depreciation  should  in  it  be  as 
rapid  as  possible.  Until,  by  a  depreciation  of  gold  corresponding 
to  that  which  has  occurred  in  California  and  Australia,  the  value 
of  that  metal  is  brought  into  harmony  with  its  cost,  we  must  con- 
tinue to  receive  from  those  countries  little  more  than  a  barren 
addition  to  our  stock  of  money.  But  with  each  successive  step  in 
the  progress  of  depreciation,  there  will  be  for  the  nation  in  which 
it  occurs,  a  nearer  approach  to  the  footing  of  commercial  equality 
with  the  gold  countries  from  which  it  has  been  temporarily  dis- 
placed ;  while  in  its  dealings  with  other  places  where  the  decline 
has  been  less  rapid,  the  nation  so  circumstanced  will,  during  the 
period  of  transition,  enjoy  a  commercial  superiority.  As  a  gen- 
eral conclusion,  therefore,  we  may  say,  that  in  proportion  as  in 
any  country  the  local  depreciation  of  gold  is  more  or  less  rapid 
than  the  average  rate  elsewhere,  the  effect  of  the  monetary  dis- 
turbance will  be  for  that  country  beneficial  or  injurious. 

This  conclusion,  I  may  in  passing  remark,  throws  light  upon  a 
practical  question  of  some  interest  at  the  present  time,  — I  mean 
the  question  of  introducing  a  gold  currency  into  India.  The 
measure  has  been  advocated  by  Mr.  M'Culloch,  on  the  ground 
that,  by  providing  a  new  market  for  the  increased  supplies  of 
gold,  its  effect  would  be  to  "  counteract  that  fall  in  its  value  which 
is  so  generally  apprehended."  *  There  can  be  no  doubt  that  the 
effect  of  the  measure  would  be  what  Mr.  M'Culloch  describes  ;  but, 
if  the  above  reasoning  be  sound,  this  circumstance,  instead  of  being 
a  reason  for  introducing  gold  into  the  currency  of  India,  affords 
{so  far  as  the  interests  of  India  are  concerned}  a  strong  reason 
against  the  adoption  of  this  course.  Mr.  M'Culloch  does  not  state 
whether  the  effect  which  he  anticipates  upon  the  value  of  gold 
would  be  general  or  local ;  whether  extending  over  the  whole 
commercial  world,  or  confined  to  the  markets  of  India,  —  a  point 
of  vital  importance  in  determining  the  character  of  the  result.  If 
the  effect  were  general  —  if,  while  counteracting  depreciation  in 
India,  it  influenced  the  value  of  gold  proportionately  in  other 
parts  of  the  world  —  then  it  must  be  conceded  that  the  result 

1  "  Encyclopaedia  Britannica,"  article  "  Precious  Metals,"  p.  473. 


212  SELECTIONS. 

would  be  entirely  beneficial.  The  evils  incident  to  a  disturbance 
of  fixed  contracts  would  be  avoided,  and  no  others  would  be  in- 
curred. But  this  is  just  the  point  which  I  venture  to  deny.  The 
adoption  of  gold  as  the  monetary  standard  of  India  would 
certainly  not  affect  the  local  value  of  gold  in  Australia  and  Cali- 
fornia ;  for,  as  I  proved  on  a  former  occasion,  the  value  of  gold 
in  these  countries  is  determined  by  its  cost,  and  its  cost  depends 
on  the  productiveness  of  the  gold-fields.  Nor,  for  reasons  which 
will  be  hereafter  stated,  would  it  influence  more  than  in  a  slight 
degree  the  range  of  gold-prices  in  England  and  the  United  States. 
The  operation,  therefore,  of  the  measure  would  be  to  depress  gold- 
prices  in  India,  or,  at  least,  to  prevent  them  from  rising  in  that 
quarter  as  rapidly  as  they  otherwise  would ;  while  in  California 
and  Australia,  in  England  and  the  United  States,  it  left  their  course 
substantially  unaffected.  Now,  this  result  would  tend  undoubtedly 
to  the  advantage  of  California  and  Australia,  of  England  and  the 
United  States,  but,  as  it  seems  to  me,  would  as  clearly  be  injurious 
to  India.  The  purchasing  power  of  the  former  countries  over  the 
markets  of  India  would,  through  the  relative  superiority  of  their 
prices,  be  increased,  but  the  purchasing  power  of  India  over  their 
markets  would,  for  the  opposite  reason,  be  diminished.  An  Eng- 
lish or  American  merchant,  instead  of  discharging  his  debts,  as  at 
present,  through  the  medium  of  silver  which  he  has  to  purchase 
with  gold  at  62d.  per  ounce  (and  may  soon  have  to  purchase  at  a 
higher  rate) ,  might  discharge  the  same  debts  with  gold  directly  ; 
and  gold  being  by  hypothesis  more  valuable  in  India  than  before, 
the  same  amount  would  of  course  go  farther.  But  an  Indian 
purchaser  of  English  or  American  commodities  would  have  the 
same  sum  in  gold  to  pay  as  if  no  change  had  taken  place  in  the 
currency  of  India  ;  while  the  gold  prices  of  his  native  productions 
being  lower,  his  ability  to  pay  would  of  course  be  less.  It  seems 
to  me,  therefore  (and  the  considerations  here  adduced  are  entirely 
independent  of  the  reasons  which  exist  on  the  score  of  good  faith 
—  the  Indian  debt  having  been  contracted  in  a  silver  currency), 
that,  viewing  the  matter  from  the  side  of  Indian  interests,  the 
introduction  of  a  gold  currency  into  India  must  be  regarded  as  a 
measure  decidedly  detrimental.1 


1  Referring  to  the  adoption  of  a  silver  standard  by  Holland  in  1851,  Mr.  M'Culloch  char- 
acterizes it  as  a  measure  ' '  in  opposition  to  all  sound  principles."  I  confess  I  am  at  a  loss 
to  conjecture  what  sound  principle  was  violated  in  preferring  as  the  standard  of  value  that 
metal,  the  value  of  which  there  was  every  reason  to  believe  would  be  the  steadier  of  the 


THE  NEW   GOLD.  213 

Returning  once  more  to  the  general  question,  we  may  consider 
the  following  conclusions  as  established  :  ist,  that  the  effect  of 
the  cheapening  of  gold  upon  commercial  countries  being  to  com- 
pel them  to  enlarge  their  metallic  currencies,  for  which  enlarge- 
ment they  must  pay  by  an  export  of  their  productions,  each 
country  will  endure  a  loss  upon  this  head  to  the  extent  of  the  ad- 
ditional sum  which  may  be  requisite  for  each  ;  and,  2dly,  that 
while  there  will  be  a  general  loss  from  this  cause,  yet  the  progress 
of  depreciation  over  the  world  not  being  uniform  or  simultaneous, 
the  primary  loss  may,  through  the  disturbance  in  international 
values  thence  arising,  in  particular  cases,  be  compensated,  or  even 
converted  into  a  positive  gain  ;  the  loss  or  gain  upon  the  disturb- 
ance being  determined  according  as  the  rise  of  prices  in  any 
country  is  in  advance  or  in  arrear  of  the  general  average.  To 
ascertain,  therefore,  the  effect  of  the  movement  upon  any  particu- 
lar nation,  we  must  consider  the  manner  in  which,  in  its  case, 
these  two  principles  will  operate. 

With  respect  to  the  first,  I  am  aware  that,  in  speaking  of  the 
loss  imposed  on  a  country  by  the  necessity  of  enlarging  its  cur- 
rency, —  by  the  necessity  of  receiving  and  keeping  increased 
supplies  of  gold  and  silver,  — I  am  using  language  which,  notwith- 
standing what  was  said  on  a  former  occasion  in  its  justification, 
and  notwithstanding  that  it  is  merely  in  strict  conformity  with  the 
most  elementary  principles  of  economic  science,  will  still  appear 
paradoxical  to  many.  I  would,  therefore,  before  proceeding  farther 
with  this  branch  of  the  argument,  ask  the  reader  to  consider  the 
case  of  a  private  merchant  who  is  compelled  to  increase  the  stock 
of  cash  with  which  he  carries  on  his  business.  The  metallic 
circulation  of  a  country  performs  in  relation  to  the  community 
functions  precisely  analogous  to  those  which  are  discharged  for  a 
merchant  by  his  cash  reserve.  If  a  merchant  can  safely  dispense 
with  a  portion  of  his  ready  cash,  he  is  enabled,  with  the  money 


two.  [I  may  say  now  (1872)  that  I  am  disposed  to  assign  much  less  importance  to  this 
question  of  a  change  in  the  monetary  standard  of  India  than  I  did  when  the  above  passage 
was  written.  The  reasoning  assumes  the  possibility  of  a  serious  divergence  in  the  relative 
values  of  gold  and  silver;  but  I  now  believe  that  such  a  divergence  is  practically  out  of  the 
question,  the  grounds  for  which  opinion  will  be  found  farther  on  (post,  p.  141).  This 
circumstance,  however,  does  not  affect  the  theoretic  point  argued  with  Mr.  M'Culloch.  If 
the  exchange  of  the  existing  silver  for  a  gold  standard  in  India  were  calculated  to  produce 
the  effects  Mr.  M'Culloch  expected  from  it,  the  measure,  it  still  seems  to  me,  would  be  open 
to  the  objections  I  have  urged  against  it.  But  I  do  not  believe  that  the  effects  in  question 
would  result;  and  I  can  well  conceive  that,  having  regard  to  the  general  convenience  of 
commerce,  the  change  might,  on  the  whole,  be  advantageous.] 


214  SELECTIONS. 

thus  liberated,  either  to  add  to  his  productive  capital,  or  to  increase 
his  private  expenditure.  On  the  other  hand,  if  he  finds  it  neces- 
sary to  increase  his  reserve  of  cash,  his  productive  capital  must 
be  proportionally  encroached  upon,  or  his  private  expenditure 
proportionally  curtailed.  And  precisely  the  same  may  be  said 
of  the  currency  of  a  nation.  Where  a  country  does  not  itself 
yield  gold  or  silver,1  every  increase  of  its  metallic  circulation 
must  be  obtained — can  only  be  obtained  —  by  parting  with  certain 
elements  of  real  wealth,  —  elements  which,  but  for  this  necessity, 
might  be  made  conducive  to  its  well-being.  It  is  in  enabling  a  na- 
tion to  reduce  within  the  narrowest  limits  this  unproductive  portion 
of  its  stock  that  the  chief  advantage  of  a  good  banking  system  con. 
sists  ;  and  if  the  augmentation  of  the  metallic  currency  of  a  country 
be  not  an  evil,  then  it  is  difficult  to  see  in  what  way  the  institution 
of  banks  is  a  good.  In  regarding,  therefore,  the  necessity  imposed 
upon  commercial  countries  of  enlarging  their  metallic  currencies 
as  injurious  to  their  interests,  I  make  no  assumption  which  is  not 
in  perfect  keeping  with  the  best  known  and  most  generally  recog- 
nized facts  of  commercial  experience. 

An  increase  in  the  metallic  currency  of  a  country,  then,  being 
an  evil,  let  us  consider  what  the  circumstances  are  by  which  the 
augmentation  rendered  necessary  by  the  gold  discoveries  will  be 
determined.  This,  it  is  evident,  will  principally  depend — the 
amount  of  business  to  be  carried  on  being  given  —  on  the  extent 
to  which  substitutes  for  metallic  money  are  in  use  ;  in  other  words, 
on  the  degree  of  perfection  which  the  banking  system  of  each 
country  has  attained.  To  illustrate  this,  let  us  suppose  a  given 
sum  of  metallic  money  —  say  a  million  sterling  —  to  be  intro- 
duced into  two  countries  in  which  the  currencies  are  differently 
constituted,  —  e.g.,  into  England  and  India.  In  India  coin  is  the 
principal  medium  of  circulation2  —  in  many  parts  the  only  one, 

1  Even  where  it  does  yield  these  metals,  the  necessity  of  augmenting  the  currency  is  not 
the  less  an  evil,  since  the  operation  will  occupy,  with  no  result  but  that  of  avoiding  an  in- 
convenience,  a  portion  of  the  labor  and  capital  of  the  country,  which,  but  for  this,  might 
have  contributed  to  its  positive  welfare. 

*  [The  reader  will  bear  in  mind  that  this  was  written  in  1859.  The  state  of  the  Indian 
currency  at  that  time  may  be  gathered  from  the  following  extracts  from  a  paper  on  "  The 
Trade  and  Commerce  of  India,"  read  before  the  British  Association  in  1859.]  "  Intimately 
connected  with  Indian  trade  and  commerce  is  a  sound  system  of  banking.  At  present  there 
are  only  three  banks  of  importance  in  India,  —  the  banks  of  Bengal,  Bombay,  and  Madras. 
These  have  no  branches,  the  absence  of  which  constitutes  one  of  the  main  defects  of  the 
system.  The  few  other  banks  in  India  do  not  issue  notes,  and  employ  their  capital  in  mak- 
ing advances  on  bills  of  lading,  in  exchange  operations,  and  in  some  instances  in  loans  to 
members  of  the  Service,  at  high  rates  of  interest;  but  afford  no  banking  facilities  for  con- 


THE  NEW   GOLD.  21$ 

and  consequently  a  million  sterling  introduced  into  the  currency 
of  India  would  represent  only  an  equal,  or  little  more  than  an 
equal,  addition  to  its  total  medium  of  circulation  —  to  the  whole 
monetary  machinery  by  which  the  exchange  of  commodities  is 
effected  and  prices  maintained.  But  in  England,  where  the  cur- 
rency is  differently  constituted,  the  result  would  he  different.  The 
great  bulk  of  the  circulating  medium  of  this  country  consists  of 
certain  forms  of  credit ;  and  the  amount  of  these  credit  media 
standing  in  a  certain  large  proportion  to  the  coin  in  the  country, 
the  effect  of  introducing  a  million  sterling  into  our  currency 
would  be  to  increase  the  medium  of  circulation  by  an  amount  very 
much  greater  than  that  of  the  added  coin.  Let  us  consider  for 
a  moment  what  becomes  of  a  sum  of  coin  or  bullion  received  into 
England.  I  do  not  now  speak  of  that  moving  mass  of  metal 
which  passes  (so  to  speak)  through  the  currency  of  the  country, 
—  which,  received  to-day  into  the  vaults  of  the  Bank  of  England, 
is  withdrawn  to-morrow  for  foreign  remittance,  —  but  of  gold, 
which  is  permanently  retained  to  meet  our  genuine  monetary  re- 
quirements. Of  such  gold  a  portion  —  greater  or  less,  according 
to  circumstances  —  will  always  find  its  way  into  the  channels  of 
retail  trade  ;  and  so  far  as  it  follows  this  course,  its  effect  in  aug- 
menting the  circulation  will  be,  as  in  India,  only  to  the  extent  of 
its  actual  amount.  But  a  portion  will  also  be  received  into  the 
banks  of  the  country,  where,  either  in  the  form  of  coin,  or  of 
notes  issued  against  coin,  it  will  constitute  an  addition  to  their 
cash  reserves.  The  disposable  cash  of  the  banks  being  thus  in- 
ducting the  internal  trade  of  the  country."  The  writer  then  refers  to  a  table,  showing  the 
state  of  the  three  leading  banks  (Bengal,  Bombay,  and  Madras)  in  the  preceding  June, 
from  which  it  appears  that  the  bullion  at  that  time  in  the  coffers  of  the  banks  was  in  excess 
of  the  notes  in  circulation,  the  amount  of  these  latter  being,  for  the  whole  of  India, 
£2,341,471,  or  about  one-tenth  of  the  amount  issued  by  the  Bank  of  England  alone;  while 
the  total  amount  of"  accounts  current "  was  only  £1,855,000,  —  about  one-sixth  of  those  held 
by  some  of  the  private  banks  of  London,  and  not  one-fifteenth  of  those  of  the  Bank  of 
England.  The  total  amount  of  commercial  bills  discounted  in  these  three  leading  banks  of 
India  is  set  down  at  £278,906!  "  And  this,"  it  is  observed,  "  in  a  country  where  the  gross 
annual  revenue  is  £34,000,000;  the  export  trade,  on  an  average  of  the  last  five  years, 
£24,000,000;  the  import  trade,  on  the  same  average,  £23,000,000,  with  an  internal  trade  to 
an  extent  almost  impossible  to  estimate."  ("The  Trade  and  Commerce  of  India,"  by 
J.  T.  Mackenzie,  read  before  the  British  Association,  1859,  pp.  15,  16.)  In  the  evidence 
taken  before  the  late  Committee  "  On  Colonization  and  Settlement  in  India,"  Mr.  Alexander 
Forbes,  when  questioned  with  reference  to  the  large  absorption  of  silver  in  India,  expressed 
his  opinion  that  the  silver  was  all  required  for  current  coin.  "  It  has  often  been  said  that 
the  natives  hoard  silver.  Now  my  experience  is  that  they  do  not  hoard  silver;  they  hoard 
gold;  and  that  the  silver  is  actually  required  for  the  commerce  of  the  country."  And  this 
he  traces  (Answers  2,222,  2,223,  2i372~8o)  *°  the  want  of  banking  accommodation  and  the 
imperfect  means  of  communication  generally  in  the  country.  See  also  the  evidence  of  Mr- 
Mangles  (Answers  1,625-1,633). 


2l6  SELECTIONS. 

creased,  an  increase  of  credit  operations  throughout  the  country 
would  in  due  time  follow.  The  new  coin  would  become  the 
foundation  of  new  credit  advances,  against  which  new  checks 
would  be  drawn,  and  new  bills  of  exchange  put  in  circulation, 
and  the  result  would  be  an  expansion  of  the  whole  circulating 
medium  greatly  in  excess  of  the  sum  of  coin  by  which  the  new 
media  were  supported.  Now,  credit,  whatever  be  the  form  which 
it  assumes,  so  long  as  it  is  credit,  will  operate  in  purchases,  and 
affect  prices  in  precisely  the  same  way  as  if  it  were  actually  the 
coin  which  it  represents.  So  far  forth,  therefore,  as  the  new 
money  enables  the  country  to  support  an  increase  of  such  credit 
media,  — to  support  them,  I  mean,  by  cash  payments,  —  so  far  it 
extends  the  means  of  sustaining  gold-prices  in  the  country ;  and 
this  extension  of  the  circulating  medium  being  much  greater  than 
in  proportion  to  the  amount  of  added  coin,  the  means  of  sustain- 
ing gold-prices  will  be  in  the  same  degree  increased.  Thus,  sup- 
posing the  ratio  of  the  credit  to  the  coin  circulation  of  the  country 
to  be  as  four  to  one  (and  the  proportion  is  greatly  in  excess  of 
this),  the  addition  of  one  million  sterling  of  coin  would  be  equiv- 
alent to  an  increase  in  the  aggregate  circulation  of  four  millions 
sterling,1  and  one  million  sterling  of  gold  would  consequently,  in 
England,  for  a  given  extent  of  business,  support  the  same  advance 
in  gold-prices  as  four  times  that  amount  in  India.  It  follows  from 
these  considerations,  that,  in  order  to  raise  prices  throughout  a 
given  range  of  transactions  to  any  required  level,  the  quantity  of 
metallic  money  which  will  be  necessary  will  vary  in  different 
countries,  according  to  the  constitution  of  their  currencies ;  the 
requirements  of  each  increasing  generally  in  an  inverse  ratio  with 
the  efficiency  of  its  banking  institutions. 

We  may  thus  see  how  very  unequal  will  be  the  operation  of  the 
gold  discoveries  with  respect  to  commercial  communities.  The 
reduction  in  the  cost  of  gold  to  which  they  have  led  has,  as  we 
have  seen,  produced  in  the  gold  countries  a  twofold  rise  of  gold- 
prices  ;  and  supposing  the  present  conditions  of  raising  gold  to 

1  Strictly  speaking,  this  conclusion  would  not  follow  on  the  above  supposition,  the  ef- 
ficiency of  different  forms  of  credit  in  performing  the  work  of  circulation  being  (as  pointed 
out  by  Mr.  Mill,  "  Principles  of  Political  Economy,"  vol.  ii.,  pp.  58-61)  different,  and  only 
some  of  them  being  in  this  respect  equal  to  coin.  But  such  distinctions  do  not  affect  the 
general  truth  of  the  principle  contended  for  in  the  text,  that  the  necessity  for  coin  varies 
inversely  with  the  use  of  credit.  Besides,  as  I  intimated,  the  proportion  of  credit  to  coin 
in  our  circulation  is  much  greater  than  I  have  assumed;  and  a  million  of  coin  taken  into 
our  currency  would  really  be  equivalent  to  more  than  four  millions  added  to  a  purely  metallic 
one. 


THE  NEW   GOLD.  21 J 

continue,  the  same  cause  must  ultimately  lead  to  the  same  result 
throughout  the  world  :  imposing  upon  each  country  the  necessity 
of  so  enlarging  its  currency  as  to  admit  of  this  advance.  But  we 
have  seen  that  the  quantity  requisite  for  this  purpose  varies  accord- 
ing to  the  monetary  status  of  the  country  for  which  it  is  required  ; 
and  inasmuch  as  the  new  money  must  be  paid  for  by  commodities, 
the  abstraction  of  commodities,  and  therefore  the  loss  of  the 
means  of  well-being,  to  which  each  country  must  submit,  will 
vary  with  the  same  circumstance.  On  the  supposition,  therefore, 
on  which  we  are  arguing,  the  quantity  of  new  money  which  Eng- 
land would  require  would  be,  when  compared  with  the  extent  of 
her  business,  extremely  small,  and  her  loss  of  real  wealth  small 
proportionally.  The  same  would  be  true  of  the  United  States, 
where  credit  institutions  have  also  attained  a  high  degree  of  ef- 
ficiency, and  whose  paper  consequently  forms  a  large  proportion 
of  the  whole  circulation.  In  France,  the  use  of  credit  being  more 
restricted,  the  requirements  for  coin  would  be  greater,  and  con- 
sequently also  the  loss  of  consumable  commodities  ;  while  in  India 
and  China,  and  indeed  in  Asiatic  communities  generally,  the  cir- 
culating medium  being  almost  purely  metallic,  the  requirements 
for  coin  would,  in  proportion  to  the  business  in  which  it  was  em- 
ployed, attain  their  maximum,  with  a  corresponding  maximum  of 
loss  in  the  elements  of  well-being.1 

The  operation  of  this  principle  is  indeed,  in  the  actual  circum- 
stances of  the  world,  in  some  degree  concealed  by  the  complex 
conditions  under  which  it  comes  into  play.  Thus  Great  Britain 
and  the  United  States,  instead  of  obtaining  the  smallest  shares, 
receive  in  the  first  instance  nearly  the  whole  of  the  new  gold.  On 
the  other  hand,  the  quantity  which  goes  to  India  and  China  from 
the  gold  countries  is  comparatively  trifling  ;2  and  although  a  large 


1  It  is  curious  to  observe  the  contradictions  in  which  persons  are  involved  who,  still  under 
the  influence  of  the  mercantile  theory  of  wealth  (and  there  are  few  even  among  professed 
economists  who  are  free  from  its  influence),  are  nevertheless  sensible  from  experience  of  the 
advantages  of  a  system  with  which  it  is  incompatible.  Thus  several  witnesses  before  the 
late  Committee  on  Indian  Colonization  refer  to  the  large  influx  of  silver  into  India  in  recent 
years  as  a  sure  indication  of  the  increasing  prosperity  of  that  country ;  yet,  almost  in  the  same 
breath,  they  speak  of  the  deficiency  of  banking  accommodation  as  among  its  most  pressing 
wants.  Now,  it  is  certain  that,  just  in  proportion  as  banking  accommodation  is  extended, 
the  absorption  of  silver  by  India  will  decline;  whence  it  would  follow,  if  the  reasoning  of 

the  witnesses  be  sound,  that  the  effect  of  the  extension   of  banks  would  be  to   check  the 

growing  prosperity  of  the  country.     See  "  Minutes  of  Evidence,"   Questions  1,625-1,633, 

2,221-2,223. 

2  This  order  in  the  diffusion  of  the  new  gold  has  not  been  sustained.    See  ante,  p.  198, 

note. 


2l8  SELECTIONS. 

drain  of  treasure  has  set  in  thither  from  Europe,  yet  this  consists 
chiefly  of  silver.  If,  however,  passing  by  the  accidents  of  the 
movement,  we  attend  to  its  essentials,  we  shall  find  that  the  re- 
sults are  entirely  conformable  to  the  principle  I  have  endeavored 
to  describe.  For  though  the  bulk  of  the  new  gold  comes  in  the 
first  instance  to  England  and  the  United  States,  —  determined 
thither  by  the  course  of  international  demand,  —  yet  England  and 
the  United  States  do  not  form  its  ultimate  destination.  The 
monetary  requirements  of  these  countries  being  easily  satisfied, 
the  mass  of  the  metal,  on  reaching  these  markets,  becomes  im- 
mediately disposable  for  foreign  purchases;  by  which  means  the 
United  States  and  England  are  enabled  to  transfer  to  other 
countries  this  unprofitable  stock,  the  commodities  with  which  in 
the  first  instance  they  parted  being  replaced  by  others  which  they 
more  require.  So  also,  although  the  metallic  drain  to  the  East  is 
composed  principally  of  silver,  the  efflux  —  at  least  in  its  present 
proportions —  is  not  the  less  certainly  the  consequence  of  the  in- 
creased production  of  gold  ;  for  the  silver  of  which  it  consists  has 
been  displaced  from  the  currencies  of  Europe  and  America  by  the 
gold  of  Australia  and  California ;  and  the  drain  to  the  East  is 
only  not  a  golden  one,  because  silver  alone  is  in  that  region  the 
recognized  standard.  As  the  final  result  of  the  whole  movement, 
we  find  that,  while  the  metallic  systems  of  England  and  the 
United  States  are  receiving  but  small  permanent  accessions,  those 
of  India  and  China  are  absorbing  enormous  supplies.  The  former 
countries,  though  the  first  recipients  of  the  treasure,  yet,  not  re- 
quiring it  for  domestic  purposes,  are  enabled  to  shift  the  burden 
to  others,  whose  real  wealth  they  command  in  exchange  ;  while 
the  latter,  requiring  what  they  receive,  are  compelled  to  retain  it. 
Having  parted  with  their  commodities  for  the  new  money,  they 
are  unable  afterwards  to  replace  them.  As  their  stock  of  coin 
increases,  their  means  of  well-being  decline,  and  they  become  the 
permanent  victims  of  the  monetary  disturbance. 

But,  secondly,  we  conclude  that  the  loss  of  real  wealth  result- 
ing from  the  augmentation  of  their  currencies  would  in  particular 
countries  be  compensated,  and  might  in  some  be  even  converted 
into  positive  gain,  by  the  disturbance  which,  during  the  period  of 
transition,  would  take  place  in  international  values.  As  has  been 
already  remarked,  a  general  rise  of  prices  in  all  countries,  if  si- 
multaneous and  uniform, — since  it  leaves  the  proportions  in  which 
commodities  are  exchanged  undisturbed,  —  leads  to  no  change  in 


THE  NEW   GOLD.  2IQ 

international  values,  and  produces  no  effect  upon  national  inter- 
ests. But  where  prices  rise  unequally,  international  values,  and 
through  these,  national  interests,  are  affected.  We  have  there- 
fore to  consider  how  far,  in  the  actual  circumstances  of  the  world, 
a  rise  of  prices  in  particular  countries,  unaccompanied  by  a  cor- 
responding advance  in  others,  is  possible,  and,  in  so  far  as  it  is 
possible,  in  what  order  the  several  changes  may  be  expected  to 
occur. 

As  regards  the  question  of  possibility,  this  is  placed  beyond 
controversy  by  the  example  of  California  and  Australia.  It  is  a 
matter  of  fact  that  prices  in  those  regions  have  advanced  in  a 
twofold  proportion,  while  no  corresponding  rise  of  prices  has 
occurred  throughout  the  world.  The  circumstances,  however,  of 
the  gold  countries  will  probably  be  thought  of  too  exceptional 
a  character  to  form  the  basis  of  any  general  conclusion  ;  and  it 
will  therefore  be  desirable  to  advert  for  a  moment  to  the  causes 
which  produced  in  California  and  Australia  that  local  elevation 
of  price,  with  a  view  to  consider  how  far  the  same  conditions  are 
capable  of  being  realized  elsewhere. 

These  causes,  as  was  formerly  shown,1  were  the  special  facili- 
ties for  producing  gold  enjoyed  by  California  and  Australia,  com- 
bined with  the  limited  range  of  their  domestic  transactions.  The 
sudden  cheapening  of  gold,  involving  a  corresponding  increase 
in  money  earnings,  placed  an  extraordinary  premium  on  the 
production  of  the  metal,  while  the  limited  range  of  their  domestic 
trade  rendered  tht  necessary  enlargement  of  their  monetary 
systems  an  easy  task.  On  the  other  hand,  the  immense  extent  of 
the  aggregate  commerce  of  the  world  required,  in  order  to  secure 
a  similar  advance,  a  proportional  increase  in  its  aggregate  stock 
of  money,  an  augmentation  which  could  only  be  accomplished 
after  the  lapse  of  a  considerable  time.  Prices  therefore  rose 
rapidly  in  the  gold  countries,  while  over  the  area  of  general 
commerce  the  rise  had  been  but  slow. 

Such  being  the  circumstances  which  produced  the  local  diver- 
gence of  prices  to  which  I  have  called  attention,  it  will  at  once  be 
seen  that  of  the  two  conditions  which  I  have  stated,  the  latter  — 
the  necessary  enlargement  of  the  local  currency — may  in  most 
countries,  though  not  in  all  at  the  same  time,  be  fulfilled,  if  not 
with  the  same  rapidity  as  in  Australia  and  California,  still  after 

*  See  Cairnes,  pp.  25, 36. 


220  SELECTIONS. 

no  very  long  delay.  It  has  been  computed,1  for  example,  that 
the  total  quantity  of  gold  coin  circulating  in  Great  Britain  amounts 
to  .£75,000,000  sterling.  Assuming  this  to  be  correct,  it  would 
follow  (all  other  conditions  being  supposed  identical)  that  an  ad- 
dition of  £75,000,000  would  be  sufficient  to  effect  an  elevation  of 
our  local  prices  equivalent  to  that  which  has  occurred  in  Austi'a- 
lia.  Now,  at  the  present  rate  of  production,  the  quantity  of  gold 
which  arrives  annually  in  Great  Britain  cannot  fall  much  short  of 
£30,000,000  sterling ; 2  so  that  were  we  merely  to  retain  all  that 
we  receive,  we  should  at  the  end  of  two  years  and  a  half  be  in  a 
position,  so  far  as  the  augmentation  of  our  currency  is  concerned, 
to  maintain  the  same  advance  in  price  as  has  occurred  in  the  gold 
countries.  If,  then,  prices  in  Great  Britain  have  not  risen  in 
the  same  degree,  the  result,  it  is  evident,  cannot  be  due  to  the 
difficulty  of  procuring  the  supply  of  gold  necessary  for  the  en- 
largement of  our  currency.  It  remains,  therefore,  to  be  con- 
sidered how  far  those  special  facilities  for  procuring  gold  which 
have  operated  in  the  gold  countries  may  come  into  play  in  other 
parts  of  the  world. 

The  extraordinary  facilities  for  procuring  gold  enjoyed  by 
Australia  and  California  depend,  of  course,  on  the  possession  of 
their  gold  mines ;  and  this  being  so,  it  might  seem  as  if  all 
countries,  not  being  like  them  auriferous,  were  by  the  nature  of 
the  case  precluded  from  fulfilling  this  condition  of  the  problem  ; 
but  this  by  no  means  necessarily  follows,  as  will  be  evident  if  we 
reflect  that  there  are  other  modes  of  obtaining  gold  than  by  direct 
production,  of  which  modes  the  efficiency  enjoyed  by  different 
countries  differs  almost  as  much  as  the  degrees  of  fertility  in  dif- 
ferent gold  mines.  Where  countries  do  not  themselves  produce 
gold,  the  mode  by  which  they  obtain  it  is  through  their  foreign 
trade.  Now,  it  is  a  fact  well  known  to  economists  3  that,  with 
reference  to  the  cost  of  commodities,  the  terms  on  which  foreign 
trade  is  carried  on  differ  greatly  in  different  countries,  the  labor  of 

111  History  of  Prices,"  voL  vi.,  App.  xxii.  Thjs  also  is  Mr.  M'Culloch's  estimate: 
"  Encyclopaedia  Britannica,"  article  "  Precious  Metals,"  p.  465.  [It  will  be  borne  in  mind 
that  these  estimates  apply  to  the  period  immediately  preceding  the  first  publication  of  these 
Essays  (1859-60).] 

*  [£20,000,000  would  have  been  nearer  the  mark,  but  at  the  time  this  paper  was  written 
no  trustworthy  statistics  of  gold  imports  existed.  Either  amount,  however,  answers  equally 
well  the  purpose  of  the  argument  (1872).] 

8  See  Ricardo's  "  Works,"  chap,  vii.,  on  Foreign  Trade.  Mill's  "  Principles  of 
Political  Economy,"  chaps,  xvii.,  xix.  Also,  Senior's  Essay,  "  On  the  Cost  of  Obtaining 
Money." 


THE  NEW   GOLD.  221 

some  going  much  farther  in  commanding  foreign  productions 
than  that  of  others.  According,  however,  to  the  conditions  on 
which  foreign  productions  generally  are  obtainable,  will  be 
those  on  which  gold  may  be  obtained.  If  a  country  possess 
special  facilities  for  supplying  markets  where  gold  can  be  given  in 
exchange,  it  will  obtain  its  gold  more  cheaply —  at  a  less  sacrifice 
of  labor  and  capital  —  than  countries  which  do  not  share  these 
facilities,  and  amongst  such  countries  it  will  therefore  occupy 
precisely  the  same  position  as  an  auriferous  country  whose  mines 
are  of  more  than  the  usual  richness  among  the  countries  which 
yield  gold.  It  is  thus  possible  for  a  non-auriferous,  no  less  than 
for  an  auriferous  country  to  possess  exceptional  facilities  in  the 
means  of  procuring  gold,  and  therefore  to  fulfil  the  second  of  the 
conditions  by  which  a  divergence  of  local  prices  from  the  ordi- 
nary level  of  the  world  may  be  effected. 

Now,  it  appears  to  me  there  are  two  countries  which  possess 
in  an  eminent  degree  the  qualifications  requisite  for  attaining  this 
result  —  I  mean  Great  Britain  and  the  United  States  :  the  former, 
as  being  par  excellence  the  great  manufacturer  among  civilized 
nations,  —  the  manufacturer  more  particularly  of  descriptions  of 
goods,  —  as  cotton,  woollen,  linen,  and  iron,  which  enter  largely 
into  the  consumption  of  the  classes  by  whom  chiefly  the  gold 
countries  are  peopled  ;  and  the  latter,  as  the  principal  producer  of 
raw  material,  as  well  as  of  certain  commodities  —  as  grain,  to- 
bacco, sugar,  and  rice  —  which  are  also  largely  consumed  by  the 
same  classes.  In  these  circumstances,  Great  Britain  and  the 
United  States  enjoy  peculiar  advantages  in  the  markets  of  the  gold- 
countries,  and  these  advantages  are  extended  and  confirmed  by 
other  important  incidents  of  their  position.  Thus  they  possess 
the  greatest  mercantile  marine  in  the  world,  by  which  they  are 
enabled  to  give  the  fullest  scope  to  their  manufacturing  and 
agricultural  superiority,  while  by  race,  language,  and  religion  they 
are  intimately  connected  with  the  producers  of  the  new  gold,  — 
a  connection  from  which  spring  ties,  moral,  social,  and  political, 
to  strengthen  and  secure  those  which  commerce  creates.  Great 
Britain  and  the  United  States  thus  possess  in  their  foreign  trade  a 
rich  mine,1  worked  by  their  manufacturers,  planters,  and  farmers, 
tended  by  their  mercantile  marine,  and  protected  by  their  naval 

i  "  The  mine  worked  by  England  is  the  general  market  of  the  world;  the  miners  are 
those  who  produce  those  commodities  by  the  exportation  of  which  the  precious  metals  are 
obtained-"  -  SENIOR'S  Essay  "  On  the  Cost  of  Obtaining  Money,"  p.  15. 


222  SELECTIONS. 

power,  — a  mine  by  means  of  which  they  are  enabled  to  obtain 
their  gold  on  terms  more  favorable  than  other  nations.  The  effect 
of  this,  in  ordinary  times,  is  shown  by  a  scale  of  money  rates, 
wages,  salaries,  and  incomes,  permanently  higher  than  that  which 
elsewhere  prevails ;  but  in  times  of  monetary  disturbance  like 
the  present,  when  the  cost  of  gold  having  been  reduced  its  value 
is  falling,  these  advantages,  it  seems  to  me,  must  tell,  as  analo- 
gous advantages  have  told  in  the  gold  countries,  in  a  more  rapid 
realization  of  the  results  which  are  in  store,  —  in  a  quicker  ascent 
towards  that  higher  level  of  prices  and  incomes  which  the 
cheapened  cost  of  gold  is  destined  ultimately  to  produce. 

There  is  reason,  therefore,  on  considerations  of  theory,  to  expect 
a  repetition  in  England  and  America  of  that  phenomenon  which 
has  been  already  exhibited  in  Australia  and  California,  — a  diver- 
gence of  local  money-rates  from  the  average  level  of  surrounding 
countries.  On  a  future  occasion  I  shall  endeavor  to  ascertain  how 
far,  in  the  case  of  Great  Britain,  these  a  priori  conclusions  are 
supported  by  facts,  —  how  far  prices  and  incomes  have  here,  under 
the  influence  of  the  gold  discoveries,  outstripped  the  correspond- 
ing movement  in  other  countries.1  Having  settled  this  point,  we 
shall  be  in  a  position  to  form  a  general  estimate  of  the  benefit 
which  may  thence  accrue  to  us.  Meanwhile,  however,  I  may,  in 
conclusion,  point  out  the  mode  in  which  the  advantages  incident 
to  the  monetary  position  we  shall  occupy  are  likely  to  be  realized. 

And  here  it  may  be  well  to  call  the  reader's  attention  to 
the  distinction,  sometimes  overlooked,  between  a  fall  in  the 
value  of  gold  and  a  rise  in  the  price  of  commodities.  A 
rise  in  the  price  of  commodities,  if  general,  implies  commonly 
a  fall  in  the  value  of  money ;  but,  according  to  the  ordi- 
nary use  of  language,  alike  by  economists  and  common  speech, 
money  would,  I  apprehend,  in  certain  circumstances,  be  said  to 
have  fallen  in  value,  even  though  the  prices  of  large  classes  of 
commodities  remain  unaffected.  For  example,  supposing  im- 
provements to  have  been  effected  in  some  branch  of  production 
resulting  in  a  diminished  cost  of  the  commodity,  the  value  of  money 
remaining  the  same,  prices  would  fall ;  if  under  such  circum- 

1  [Some  evidence  on  the  point  will  be  found  in  the  Appendix ;  but  the  inquiry  here  con- 
templated was  never  carried  into  effect.  A  very  interesting  and  carefully  prepared  paper  on 
the  subject,  however,  wa8  read  some  years  later  by  my  friend  Professor  Jevons,  before  the 
London  Statistical  Society,  when  I  had  the  sntisfaction  to  find  that  the  results  of  his  entirely 
independent  investigations  to  a  very  large  extent  corroborated  the  conclusions  at  which  I 
had  arrived,  mainly  by  way  of  deduction  from  the  general  principles  of  the  science.] 


THE  NEW   GOLD.  223 

stances  prices  did  not  fall,  that  could  only  be  because  money  had 
not  remained  the  same,  but  had  fallen  in  value.  The  continuance 
of  prices  unaltered  would,  therefore,  under  such  circumstances, 
amount  to  proof  of  a  fall  in  the  value  of  gold.  Now,  when,  in 
connection  with  this  consideration,  we  take  account  of  the  fact 
that  over  the  greater  portion  of  the  field  of  British  industry  im- 
provement is  constantly  taking  place,  it  is  obvious  that  the  mere 
movements  of  prices  here,  taken  without  reference  to  the  condi- 
tions of  production,  are  no  sure  criterion  of  changes  in  the  value 
of  gold. 

The  truth  is,  in  a  large  class  of  commodities,  —  in  all  those  to 
which  mechanical  or  chemical  inventions  are  extensively  appli- 
cable, —  even  on  the  supposition  of  a  very  great  depreciation  of 
gold,  no  considerable  advance  in  price  is  probable.  Gold,  for 
example,  might  have  fallen  since  the  beginning  of  the  present 
century  to  the  extent  of  75  per  cent.,  —  that  is  to  say,  four  sov- 
ereigns now  might  be  equal  to  no  more  than  one  sovereign  at  the 
commencement  of  the  period,  —  and  yet  in  a  large  class  of  manu- 
factured goods  no  advance  in  price  would  be  apparent,  the  reduc- 
tion in  the  cost  of  production  being  in  more  than  an  equal  propor- 
tion. In  ordinary  times,  agricultural  operations  escape  in  a  great 
degree  the  influence  of  industrial  progress  ;  but  within  the  last 
ten  years  —  that  is  to  say,  since  the  repeal  of  the  Corn  Laws, 
which  nearly  synchronized  with  the  gold  discoveries  —  the  spirit 
of  improvement  has  been  as  busy  in  agriculture  as  in  any  other 
department  of  industry,  and,  in  conjunction  with  impoi'tations 
from  foreign  countries,  has  acted,  and  must  for  some  time  at  least 
continue  to  act,  powerfully  upon  the  price  of  raw  products  in  this 
country. 

The  depreciation  of  gold,  therefore,  may  be  realized  either  in 
a  corresponding  advance  of  prices,  or  in  the  neutralization  of  a 
fall  which,  in  the  absence  of  depreciation,  would  have  occurred  ; 
but  in  whatever  form  it  may  come  to  us,  our  gain  or  loss  as  a 
nation  will  be  the  same,  and  will  depend  upon  the  condition  I 
have  stated,  —  the  more  or  less  rapid  depreciation  of  our  currency 
as  compared  with  the  currencies  (convertible,  like  ours,  into  gold) 
of  other  countries.  Whether,  the  conditions  of  production  remain- 
ing unaltered,  the  depreciation  be  indicated  by  a  corresponding 
advance  of  prices,  or,  those  conditions  undergoing  improvement, 
the  fall  in  the  value  of  gold  merely  operates  in  neutralizing,  as 
regards  price,  the  effects  of  the  cheapened  cost  of  commodities, — 


224  SELECTIONS. 

in  either  case  the  gold  price  of  the  products  of  English  labor 
and  abstinence  'will  rise.  A  given  exertion  of  English  industry 
will  reap  a  larger  gold  reward  than  before  ;  and  foreign  commodi- 
ties not  rising  in  price  in  the  same  degree,  the  larger  gold  reward 
will  indicate,  over  so  much  of  our  expenditure  as  is  directed  to 
foreign  productions,  a  real  augmentation  of  well-being.  As 
regards  that  portion  of  our  expenditure  which  falls  upon  the  prod- 
ucts of  our  own  industry,  individuals  and  classes  will,  according 
to  circumstances,1  be  benefited  or  injured  by  the  change  ;  but  as 
a  nation,  we  shall  neither  gain  nor  lose,  since  here  the  increased 
cheapness  of  gold  will  be  exactly  neutralized,  either  by  a  corre- 
sponding advance  in  price,  or  by  the  prevention  in  the  same 
degree  of  a  fall  which  would  otherwise  have  taken  place.  It  is 
in  this  way,  —  by  the  increased  command  which  she  obtains  over 
foreign  markets  by  her  cheap  gold,  —  and  not,  as  is  commonly 
supposed,  by  finding  an  outlet  for  her  wares  in  California  and 
Australia,  that  England  will  benefit  by  the  gold  discoveries.  That 
outlet  for  her  productions,  —  were  the  movement  to  stop  here,  — 
however  it  might  benefit  individuals,  would  for  the  country  at 
large  be  an  injury  and  not  a  boon  ;  it  would  deprive  her  of  that 
which  might  conduce  to  her  comfort  and  happiness,  and  would 
give  her  a  "  breed  of  barren  metal"  in  exchange.  But  the  move- 
ment does  not  stop  here.  The  money  which  she  obtains  from  the 
gold  countries,  instead  of  absorbing,  like  India  or  China,  she  em- 
ploys in  purchasing  the  goods  of  other  nations.  It  is  in  the  en- 
larged command  which  she  acquires  over  such  goods  that  her 
gain  consists,  and  it  is  thus  that  she  indemnifies  herself,  though  at 
the  expense  of  the  nations  who  ultimately  retain  the  new  gold,  for 
the  loss  —  the  indubitable  loss  —  which  she  is  called  on  in  the  first 
instance  to  sustain. 

1  On  this  point  see  Cairnes,  p.  147,  et  seq. 


FRANCE  SOUS  LE  SECOND  EMPIRE.         22$ 


XL 

FRANCE  SOUS  LE  SECOND  EMPIRE. 

FROM    LEVASSEUR'S    HISTOIRE    DES    CLASSES    OUVRIERES.      VOL.    n, 
"*•   307-321. 

CREDIT  ET  ECHANGES. 

DEPUIS  quinze  ans,  trois  grand  faits  economiques  ont  exerc6 
en  France  une  influence  considerable  sur  la  production  manu- 
facturiere ;  le  developpement  du  credit,  la  multiplication  des 
chemins  de  fer  et  la  reforme  douaniere. 

II  entrait  dans  les  vues  du  gouvernement  de  provoquer  1'esprit 
d'entreprise.  L'annee  1852  vit  se  former  deux  £tablissements 
d'une  nature  tres-diverse,  mais  qui  tous  deux  devaient  concourir 
au  meme  but,  celui  de  fournir  des  capitaux  au  travail,  le  Credit 
foncier  et  le  Credit  mobilier. 

Le  premier,  depuis  longtemps  reclame  par  M.  Wolowski,  se 
proposait  de  venir  en  aide  a  1'agriculture  en  avan9ant  sur  premiere 
hypotheque  a  la  propriete  fonciere  des  sommes  remboursables  par 
annuites  ;  en  realite,  les  prets  agricoles,  qui  augmentent  aujourd'- 
hui,  ont  etc  les  plus  lents  a  se  deVelopper,  et  la  nature  de  sa 
clientele  1'a  fait  servir  plus  a  la  construction  des  maisons  et  aux 
travaux  publics  dans  les  communes  qu'a  la  culture  proprement 
dite  :  a  ce  titre,  il  appartient  a  Phistoire  de  Pindustrie.  Le  second, 
cre£  et  dirige  par  M.  E.  Pereire,  est  une  puissante  banque  de 
commandite  et  de  speculation,  non  sans  analogic  avec  celles  que 
recotnmendait  le  saint-simonisme.  II  £tait  destin£  par  ses  statuts 
a  fonder  ou  a  soutenir  de  grandes  entreprises,  et  il  a,  en  effet, 
donne  naissance  aux  chemins  de  fer  du  Midi,  a  la  compagnie  im- 
mobiliere  de  Paris,  au  gaz  de  Marseille,  aux  paquebots  trans- 
atlantiques  ;  il  devait  etre,  en  raison  meme  de  son  caractere,  tres- 
vivement  affect^  par  toutes  les  influences  de  hausse  et  de  baisse,  et 
sa  fortune  dependait  entierement  de  Phabilete  de  ses  directeurs. 

La  Banque  de  France,  dont  le  gouvernement  avail  le  droit  de 
suspendre  le  privilege  en  1855,  fut  aftranchie  de  cette  crainte  et 
autorisee  a  faire  des  avances  sur  d£pot  d'actions  et  d'obligations 


226  SELECTIONS. 

de  chemin  de  fer : l  la  speculation  en  usa  largement.  Quelques 
annees  apres,  la  Banque  obtenait  par  une  loi  la  prorogation  de 
son  privilege  jusqu'en  1897,  au  prix  de  icx>  millions  pretes  a 
1'Etait  et  fournis  par  une  emission  de  nouvelle  actions  ;  la  Banque 
pouvait  Clever  le  taux  de  son  escompte  au-dessus  de  6  pour  100, 
et  le  gouvernement  pouvait  exiger,  dix  ans  apres  la  promulgation 
de  la  loi,  qu'elle  cut  au  moins  une  succursale  par  departement.2 

"  Les  operations  de  la  Banque  se  sont  considerablement 
ameiiorees,  disait  le  gouverneur  en  parlant  de  la  situation  en 
1852,  le  commerce  et  1'industrie  ont  repres  leur  essor."  En  eftet, 
le  montant  des  operations  s'etait  eieve  d'un  milliard  et  demi, 
chiffre  de  1851,  a  deux  milliards  et  demi.  Le  produit  des  imp6ts 
indirects  s'etait  notablement  accru  ;  la  rente  avait  depasse  le  pair  ; 
toutes  les  valeurs  de  bourse  avaient  ete  emportees  dans  le  meme 
mouvement,  et  les  marchandises,  sous  la  triple  impulsion  de 
1'abondance  de  1'or,  d'une  consommation  plus  active  et  d'une 
speculation  audacieuse,  encherissaient  chaque  jour. 

Ce  fut  1'age  d'or  de  la  Bourse.  Londres,  qui  avait  ete  depuis 
le  commencement  du  siecle  le  principal  marche  des  capitaux  et 
des  grandes  entreprises  en  Europe,  ceda  le  pas  a  Paris.  L'eian 
etait  tel  qu'il  permit  au  commerce  de  franchir  le  cholera,  ladisette, 
la  guerre  d'Orient,  et  a  1'Etat  d'emprunter  un  milliard  et  demi 
sans  briser  le  ressort  du  credit.  Les  capitaux,  a  peine  formes, 
etaient  absorbes ;  les  travaux  publics,  les  emprunts,  la  disette 
elle-meme,  tout  y  contribuait ;  on  speculait  a  la  hausse,  et  les 
cours  s'eievaient. 

Cependant  les  affaires  etaient  devenues  plus  difficiles  en  1856  : 
le  gouvernement  crut  utile  d'enrayer  lui-meme  la  speculation 3  et 
de  faire  une  loi  restrictive  sur  les  societes  en  commandite  par 
actions.4  La  langueur  continua  cependant  en  1857,  et  1'abondance 
de  la  recolte  rendait  inevitable  edata  avec  violence  aux  Etats-Unis. 
Elle  se  communiqua  rapidement  a  Londres,  a  Hambourg,  a 
Paris.  Quoique  moins  rudement  eprouvee  que  ses  voisines,  la 
France  vit,  comme  elles,  les  sources  du  credit  tarir ;  la  specula- 
tion dut  liquider,  et  1'annee  1858  fut  marquee  par  une  baisse 
generale  des  marchandises5  et  par  un  ralentissement  des  trans- 
actions. 

i  Ddcret  du  28  mars  185*.  2  Loi  du  9  juin  1857. 

»  Voir  au  Man.,  la  note  du  q  mars  1856. 

4  Loi«du  17  juillet  1856.     II  sVtait  forme1,  en  1852,  ai  socteWs  de  ce  genre;  en  18531  25;  en 
1854,36;  en  1855,  18;  en  1856,  17.     II  s'en  forma,  en  1857,  6;  13  en  1858,  et  i a  en  1859. 
8  Voir,  sur  cette  crise,  la  Question  de  I'or,  par  E.  Levasseur. 


FRANCE  SOUS  LE  SECOND  EMPIRE.         22/ 

La  guerre  d'ltalie  qui  survint  I'anne'e  suivante,  et  ses  con- 
se'quences  qui  se  firent  sentir  jusqu'en  1862,  empecherent  les 
affaires  de  reprendre  leur  essor  jusqu'au  jour  ou  le  combat  d' As- 
promonte  fit  croire  a  la  consolidation  du  trone  de  Victor-Em- 
manuel. Les  cours  se  releverent  alors,  et  1'esprit  d'entreprise  se 
ranima.  Mais  une  autre  cause  de  malaise  pesait  deja  sur  le 
marche :  la  guerre  d'Ame'rique  privait  1'Europe  de  coton  et 
redusait  a  la  misere  les  districts  manufacturiers  de  1'Angleterre  et 
de  la  France.  Une  crise  mone'taire  s'ensuivit ;  en  1864,  1'es- 
compte  de  la  Banque  de  France  monta  a  8  pour  loo,1  et  le 
gouvernement,  sollicite"  par  une  petition  de  trois  cents  negociants 
et  par  une  contrepetition  de  la  Banque,  ordonna  une  enquete  sur 
le  regime  du  credit.  Cette  crise  s'apaisait  a  son  tour,  lorsque 
eclata  la  guerre  du  Danemark,  puis  la  guerre  d'Allemagne.  Les 
agitations  de  la  politique,  dans  le  vieux  et  dans  le  nouveau 
monde,  contrarient  frequemment,  depuis  dix  ans,  le  deploiement 
pacifique  des  forces  du  travail  marchant  a  la  conquete  de  la 
matiere. 

Une  ville  a  particulierement  souffert,  et  souftre  aujourd'hui  plus 
que  les  autres,  de  la  langueur  des  affaires  dont  se  plaint  le  com- 
merce. C'est  Lyon,  dont  la  nombreuse  population  ouvriere, 
dependant  presque  tout  entiere,  pour  sa  subsistance,  d'une  seule 
Industrie  de  luxe,  est  toujours  la  premiere  a  s'affaisser  sous  le 
coup  des  crises  et  la  derniere  a  se  relever.  Elle  avait  d^veloppe" 
ses  relations  exterieures  ;  la  guerre  d'Amerique  lui  a  ete  funeste  ; 
de  84  millions  en  1865. 2  Le  meilleur  remede  pour  elle  serait,  a 
cote  de  son  Industrie  de  luxe,  soumise  aux  caprices  de  la  mode  et 
aux  variations  de  la  fortune,  la  creation  d'une  Industrie  commune 
ayant  un  large  debouch^. 

Neanmoins,  malgre  les  obstacles,  le  travail  a  brillamment 
deploy^  ses  forces.3  La  Banque  de  France  dont  les  escomptes, 
&  Paris,  avaient  une  seule  fois  atteint  1,329  millions,  sous  le  regne 
de  Louis-Philippe,  atteignit  de  nouveau  et  depassa  ce  chiffre  en 
1856  ;  en  1865,  elle  faisait  2,458  millions.  Elle  etait  alors  devenue 
la  seule  banque  d'emission  et  la  regulatrice  souveraine  du  credit 
en  France  ;  les  operations  de  ses  succui'sales,  jointes  au  chiflre 
des  affaires  de  Paris,  formaient,  a  la  meme  e"poque,  un  total  de 

1  Au  mois  de  mai. 

2  Lettre  de  M.  Arlfes  Dufour  i  V  Opinion  nationale  du  18  octobre  1866. 

3  Le  progr^s  des  impots  indirects,  qui  a  continu^  en  1866,  est,  avec  le  prog-res  du  com- 
merce exterieur,  une  preuve  que  la  situation,  consid^r^e  dans  son  ensemble,  n'a  pas  empire1 
depuis  une  an,  malgrd  la  langueur  des  affaires  dans  diverses  industries. 


228  SELECTIONS. 

7,422  millions,  tandis  qu'en  1847  les  banques  departementales  et 
la  Banque  de  France  n'atteignaient  que  2,075  millions.  Dans  le 
meme  temps,  sans  que  le  commerce  des  banques  privies  parut 
diminuer,1  se  fondaient  d'autres  grands  ^tablissements,  comme  la 
Socie'te'  ge'ne'rale  de  credit  industriel  et  commercial,2  la  Socie'te'  de 
depots  et  de  comptes  courants,3  la  Society  generate  pour  favoriser 
le  commerce  et  1'industrie  en  France.4  L'usage  des  cheques, 
autrement  dit  1'habitude  de"poser  en  banque  ses  fonds  de  caisse  et 
de  faire  ses  paiements  en  mandats,  commence,  quoique  trop 
lentement,  a  se  naturaliser  en  France  et  a  mettre  une  plus  grande 
masse  de  capitaux  a  la  disposition  du  credit. 

Parmi  les  entreprises  qui  devaient  obtenir  la  faveur,  les 
chemins  de  fer  e"taient  au  premier  rang.  On  avait  souvent 
reproch£  a  la  France  de  s'etre  laisse  devancer  par  ses  voisins,  et 
1'activite  imprimee  aux  constructions  durant  la  seconde  moitie  du 
regne  de  Louis-Philippe  par  la  loi  de  1842,  s'etait  amortie  sous  la 
Re"publique.  Le  nouveau  gouvernement  la  ranima.5  Les  capi- 
taux e"taient  confiants.  On  en  profita  pour  inaugurer  un  autre 
mode  de  concession.  A  la  construction  de  la  voie  par  1'Etat,  on 
substitua  la  construction  par  les  compagnies  que  Ton  encouragea 
par  une  longue  jouissance  ;  les  baux,  avec  les  nouvelles  com- 
pagnies et  meme  avec  les  anciennes,  furent.la  plupart  passes  ou 
revises  pour  quatre-vingt-dix-neuf  ans.6  On  engageait  sans  doute 
un  plus  lointain  avenir ;  mais  on  faisait  immediatement  peser 
toute  la  charge  sur  les  capitaux  appeles  a  recueillir  les  benefices 
les  plus  directs  de  1'entreprise  ;  la  combinaison  £tait  evidemment 
preferable.  Elle  n'eut  pas  etc  possible  dix  ans  plus  tot. 

Les  concessions  multiples,  errant  des  inte"rets  divers  et  parfois 
hostiles  sur  un  meme  parcours,  e"taient  un  obstacle  a  la  circula- 
tion. On  les  reunit,  de  maniere  a  former  de  vastes  compagnies 
qui  se  partagerent  le  domaine  du  re'seau  francais :  ce  ne  fut  pas 
sans  quelques  tatonnements  qui  fournirent  des  armes  a  la  specu- 
lation.7 Mais  dans  1'espace  de  la  premiere  ann6e,  3,000  kilome- 

1  On  pretend  toutefois  qu'il  n'augmente  pas.          2  7  mai  1859. 

S6juillet  1863.  *  4  mai  1864. 

B  I,e  chemin  de  ceinture  avait  ii&  de'creW  des  le  n  de'cembre  1851.  Dans  la  seule  anne'e 
1852,  46  d^crets  furent  rendus  relativement  aux  chemins  de  fer,  et  267  kiloin.  furent  livre's 
&  la  circulation. 

6  Les  concessions  etaient  faites  pour  99  ans,  avec  garantie,  pour  le  capital  engagi  par  les 
Compagnies,  d'un  minimum  d'intdret  de  4$  pendant  la  moitte  de  ce  temps.  O,uelques  conces- 
sions  furent  meme  faites  sans  garatie.  Cette  granantie  fut  d'ailleurs  supprime'e  pour  le  pre- 
mier re'seau,  lorsque  la  loi  du  11  juin  1859  accorda  une  garantie  particuliere  au  second  re'seau. 

i  Decrets  du  17  Janvier,  19  fevrier,  20,  27  mars  1852. 


FRANCE   SOUS   LE   SECOND   EMPIRE.  229 

tres  trouvaient  des  concessionnaires ;  et,  a  la  fin  de  la  quatrieme 
annee,  sur  une  longuer  d'environ  5^000  kilometres,  les  trains  circu- 
laient. 

Les  grandes  arteres  etaient  dessinees  et  allaient  se  terminer  en 
peu  d'annees.  Le  gouvernement  resolut  hardiment  d'aborder  la 
construction  des  lignes  secondaires  et  de  faire  penetrer  la  vie  com- 
merciale  dans  tout  le  corps  de  la  nation,  com  me  les  petits  vais- 
seaux  font  penetrer  le  sang  jusque  dans  les  chairs  de  riiomme. 
Cette  fois,  le  profit  ne  semblait  pas  pouvoir  de  longtemps  remu- 
nerer  la  defense  et  d'ailleurs  la  crise  de  1857  avait  rendu  plus 
timides  les  entreprises.  Le  gouvernement  intervint,  et,  par  deux 
lois  successives,1  donna  des  subventions  ou  garantit  aux  capitaux 
du  second  reseau,  lesquels  devaient  etre  fournis  par  des  obliga- 
tions, un  inte'ret  de  4  pour  100  et  1'amortissement  en  cinquante 
ans. 

C'est  ainsi  qu'a  la  fin  de  1'annee  1866,  la  longueur  totale  des 
concessions  definitives  atteignait  21,050  kilom.,  et  celle  des 
lignes  exploitees,  14,506 ;  la  depense  faite  s'eUevait  a  pres  de  7 
milliards.2 

Les  canaux,  quoique  relegue's  au  second  plan,  ont  ete  terminus 
sur  plusieurs  points,  entrepris  sur  quelques  autres,3  et  sont  ren- 
tres,  pour  la  plupart,  dans  le  domaine  de  1'Etat,4  qui  s'est  em- 
presse  d'abaisser  presque  partout  les  droits  au  niveau  des  frais 
d'entretien.  La  navigation  des  rivieres  a  ete  amelioree.5  Les 
grandes  routes,  paralleles  aux  voies  de  fer,  se  trouvaient  d6- 
laiss^es  ;  mais  les  routes  transversales,  emportant  ou  apportant 
voyageurs  et  marchandises,  que  les  trains  recueillent  ou  sement 
sur  leur  route,  s'animaient.6  On  a  en  consequence  redouble 
de  zele  dans  1'application  de  la  loi  de  1836  sur  les  chemins 
vfcinaux,7  et  une  loi  nouvelle  a  encourage  les  conseils  gene- 
raux  a  construire,  aux  memes  conditions,  des  chemins  de  fer, 

1  Lois  du  ii  juin  1859  et  du  n  juin  1863. 

»  On  se  rappelle  qu'a  la  fin  du  regne  de  Louis- Philippe,  la  ddpense  effectue'e  dtait  d'envi- 
ron  i  milliard  J,  et  le  nombre  de  kilometres  exploited  de  1830. 

3  LaFrance  poss^dait  4,200  kilom.  de  canaux  en  1848,  et,  en  1866,  4,500;  de  plus,  6,900  kil. 
de  rivieres  navigables.  De  grands  travaux  ont  &£  poursuivis.  Voir  Exp.  de  la  sit.  de 
I'Emp.,  1867,  Man.,  p.  450  et  451. 

*  De"cret  du  Janvier  1852  et  loi  du  28  juillet  1860. 
5  Voir,  entre  autres,  la  loi  du  14  juillet  1861. 

*  De  1848  a  1866  exclusivement,  1'Etat  a  ddpensd  pour  routes,  canaux,  ponts,  phares,  etc., 
627  millions. 

7  Relativement  aux  chemins  de  fer,  routes,  canaux,  etc.  M.  P.  Boiteau.  Voir  Fortune 
publique  et  finances  de  la  France,  t.  I.  Le  chemins  vicinaux  ont  coute  en  1866,  120  millions, 
dont  un  tiers  en  prestations,  en  nature. 


230  SELECTIONS. 

qui,  a  1'exemple  de  ceux  de  1'Alsace,  formeront  un  troisieme 
reseau.1 

La  telegraphic  e"lectrique,  qui  e"tait  a  ses  debuts  en  1851,  a  com- 
mence" a  envelopper  de  son  re'seau  la  France,  a  la  suite  du  d^cret 
du  6  Janvier  1852  ;  elle  couvre  aujourd'hui  1'Europe  f  elle  fait 
communiquer  les  deux  mondes  et  transmet,  en  France  seulement, 
pres  de  trois  millions  de  depeches  pour  le  compte  des  particuliers.3 
La  poste,  dont  le  service  a  refu  a  diverses  reprises  de  notables 
ameliorations,  transportait  trois  fois  plus  de  lettres  ou  d'imprime's, 
en  1865  qu'en  1847;*  ^e  nombreuses  conventions  postales  et  des 
conventions  monetaires  ont  6t6  signers  avec  les  pays  voisins.5 
Les  regions  lointaines  de  1'Asie  et  de  l'Am£rique  ont  ete  mises  en 
relations  re"gulieres  avec  nos  ports  par  la  Compagnie  des  mes- 
sageries  imperiales,  qui  s'est  habilement  transfbrmee  devant  la 
concurrence  des  chemins  de  fer,  et  par  la  Compagnie  des  paque- 
bots  transatlantiques  dont,  vingt  ans  auparavant,  un  ministre 
aurait  deja  voulu  doter  la  France.6 

Les  hommes,  leurs  pensees  et  leurs  produitscirculent  aujourd'hui 
en  beaucoup  plus  grande  nombre,7  avec  plus  de  rapidite  et  a  moins 
de  frais  :  cette  mobilite  qui  a  sensiblement  modifie  I'e'co  nomie  de 
la  vie  privee,  et  qui  modifie  les  rapports  des  nations  restera,  un  des 
caracteres  distinctifs  de  la  seconde  moitie"  du  dix  neuvieme  siecle. 

Avec  de  pa  fellies  conditions,  le  commerce  ext£rieur  ne  pouvait 
manquer  de  s'accroitre.  En  1850,  epoque  a  laquelle  il  avait  a 
peu  pres  retrouve"  le  niveau  de  ratine" e  la  plus  prospere  du  regne 

1  C'est  en  1859  et  1860  que  le  conseil  ge'ne'ral  du  Bas-Rhin,  M.  Migneret,  dtant  preset, 
classa  les  premiers  chemin  de  ce  genre.  —  La  loi  rendue  sur  la  matiere  et  du  12  juillet  1865, 
Deux de'partements  (Eure,  Saone,  et  Loire),  inddpendamment  du  Haut  et  du  Bas-Rhin  ont 
deji  entrepris  des  chemins  de  ce  genre  29  autres  de'partements  ont  de'cide'  en  principe  des 
creations  du  meme  genre. 

2  Grace  &  la  convention  te'le'graphique  du  17  mai  1865,  "  le  reseau  te'le'graphique  du  conti- 
nent europe'en  est  aujourd'hni  dans  toutes  ses  parties  sans  exception,  soumis  i  des  principes 
et  a  des  regies  uniformes."    Exp.  de  la  sit.  de  VErnp.,  1867. 

3  2,367,091  depeches  dans  les  10  premiers  mois  de  1866,  ce  qui  suppose  environ  2,480,000 
pour  I'anne'e.    Au  ier  d^c.  1866,  il  y  avait  2,091  bureaux  teldgraphiques.     Des  lignes  souter- 
raines  ont  <*te  etablies  dans  quelques  grandes  villes  et  des  fils  d'un  diametre  sup^rieur  sur 
les  principales  lignes  pour  proven  ir  les  interruptions  de  service. 

4  En  1847,  216  millions;  en  1865,  590  millions. 

<•  La  convention  mone'taire  du  23  de'c.  1865  a  etahli  une  monnaie  uniforme  (mais  critiquable 
k  certain  e'gard)  entre  la  France,  la  Belgique,  la  Suisse,  PItalie  et  commence  i  constituer  ce 
que  M.  de  Parieu  nomme  le  Munzverein  latin. 

«  Plusieurs  autres  services  ont  et<<  <£tablis,  Exp.  de  la  sit.  de  PEmp,  1867. 

'  Le  nombre  des  voyageur  des  chemins  de  fer  etait  de  37  millions  en  1857,  de  84  millions 
en  1866.  Dans  cette  derniere  annee,  les  84  millions  de  voyageurs  ont  fait  3,361  millions  de 
kilometres  et  34  millions  de  tonnes  ont  fait  5, 171  millions  de  kil.  Le  produit  brut  a  616  de 
184  millions  de  francs  pour  les  voyageurs  etde  314  millions  pour  les  marchandises.  Depuis 
1855,  le  prix  moyen  kilomeirique  du  transport  de  la  tonne  a  baisso  de  o  fr.  1,117. 


FRANCE  SOUS  LE  SECOND  EMPIRE.        231 

de  Louis- Philippe,  il  etaitde  2,555  millions.  En  1864,  il  s'elevait 
a  7,329  millions,  c'est-a-dire  qu'il  a  presque  tripl6  dans  1'espace 
de  quinze  ans. 

Si  Ton  prend  la  moyenne  de  chacun  des  trois  lustres  qui 
composent  cette  pe>iode,  on  constate,  non-seulement  un  progres, 
mais  une  progression  constante,  a  n'envisager  que  les  marchan- 
dises  importees  ou  exportees  au  commerce  special.  La  moyenne 
de  1850-1854  est  de  2,294  millions  ;  celle  de  1855-1859,  de  3,626 
millions,  et  celle  de  1860-1864,  periode  pendant  laquelle  1'abaisse- 
ment  des  tarifs  fran^ais  a  provoque  la  concurrence  etrangere,  de 
4,701  millions  et  le  progres  continue.1 

II  a  etc  plus  rapide  qu'aux  deux  epoques  pr^cedentes  de  notre 
histoire  contemporaine.  Durant  les  quinze  annees  de  la  Res- 
tauration,  notre  commerce  exterieur  avait  a  pen  pres  double  ; 
durant  les  dix-sept  annees  du  regne  de  Louis-Philippe,  il  avait 
fait  un  peu  plus  que  doubler.2 

Ce  progres  tient  a  des  causes  generates  et  n'estpas  un  privilege 
particulier  a  la  France.  Dans  les  etablissements  de  credit  c'est 
elle  qui  a  donn6  des  exemples  a  une  partie  de  1'Europe,  mais  elle 
n'a  fait  que  suivre  a  distance  1'Angleterre  ;  dans  la  construction 
des  chemins  de  fer,  elle  avait  6t6  devanc^e  par  plusieuas  Etats. 
Cependant  aucune  nation,  la  Belgique  exceptee,3  n'a,  depuis 
quinze  ans,  plus  largement  que  la  France,  etendu  ses  relations 
exterieures.  Pendant  qu'elle  en  triplait  le  chiffre,  la  plupart  des 
pays  commei^ants,  et  1'Angleterre  en  particulier,  doublaient 
seulement  le  leur ;  il  est  juste  de  noter  toutefois  que  ce  double- 
ment,  en  Angleterre,  portait  son  chiffre  an  milliards.4 

1  Ces  chiffres,  il  est  vrai,  sontceux  des  valeurs  actuelles,  c'est-a-dire  des  prix  du  marchd, 
et,  comme  la  valeur  de  1'argent  a  diminud,  ils   ne   repre'sentent  pas   une   quantity  triple  de 
marchandises.     L'anne'e  1865,  donton  ne  connait  encore  que  le  commerce  special,  a  produit 
5,981  millions,  I'anne'e  1866  produira  environ  6,360  millions  (a  produit  5,308  millions   pour 
les  10  premiers  mois)  ;  le  commerce  special  de  1864  etaitde  5,452  millions.  La  navigation  s'est 
accrue  comme  le  reste;  12,531,504  tonnes  en  1854;  17,638,900  tonnes  en  1866.     La  principale 
augmentation  a6t6  pour  les  ports  de  Marseille,  du  Havre  et  de  Bordeux. 

2  En  1815    (tres-mauvaise  annee   d'aileurs),   621    millions,   en  1830,    1,211  millions;   en 
1847,  2i437  millions. 

3  Belgique,  en  1835,   358  millions   de   francs,  et,  en  1847,  S8^  en    l85°>  6l8  millions  et,  en 
1864,  2,432  millions;  ce  qui  fait  environ  500  fr.  per  habitant.   En  France,  la  proportion  n'est 
pas  tout  k  fait  de  200  fr.  par  habitant.     Elle  est  en  Angleterre  de  366  fr. 

4  En  1854  (premiere  ann£  ou  la  statistique ait  donmi   les   valeurs),  268  millions   de   livres 
sterling,  et,  en  1864,  435  millions,  (soit  environ   10  milliards,  900   millions).     En  1830,  une 
statistique  anglaise  (voir  les   Annales  du  commerce  exterieur)   donnait   120  millions :  il  y 
aurait  done  eu  £  peu  pres  doublement  de    1830   i  1850.     Pays-Bas,  en    1832,  471  millions  de 
francs;  en  1850,  1,079;  en  1864,  1,904.    Russie,  en  1850,  192  millions  de  roubles;    en  1863, 
306  millions.    Etats-Unis,  en  1831,  environ  184  millions   de   dolLirs;  en    1851,  412  millions; 
en  1860,  762  millions. 


232  SELECTIONS. 

II  reste  a  dire  quelles  lois  ont  favorise'  cette  extension  du  com- 
merce et  r^gissent  aujourd'hui  le  travail. 

LES  TRAirfis  DE  COMMERCE. 

Quelques  jours  apres  la  proclamation  de  1'Empire,  le  s^natus- 
consulte  du  25  decembre  1852  interpr£tait  et  etendait  les  preroga- 
tives du  souverain  en  matiere  de  trait^s  de  commerce,  en  declarent 
qu'ils  auraient  "  force  de  loi  pour  les  modifications  de  tarif  qui  y 
sont  stipule'es,"  e'est-a-dire  que  le  Corps  legislatif  n'aurait  plus  le 
droit  de  les  ratifier  on  de  les  annuler  par  son  vote.  Ce  pouvoir, 
remis  au  chef  de  1'Etat,  pouvait,  en  dehors  des  considerations 
politiques,  inquirer  certains  int^rets ;  le  president  du  Senat,  dans 
son  rapport,  s'appliqua  a  les  rassurer  en  se  pronoi^ant  contre  les 
theories  de  la  liberte  commerciale 

Cependant  la  r^colte  de  1853  fut  mauvaise.  L'importation 
seule  pouvait  combler  le  deficit.  Le  gouvernement,  pour  1'en- 
courager,  n'hesita  pas  a  abaisser  toutes  les  barrieres  de  la  douane  ; 
il  de"creta  la  suspension  de  1'echelle  mobile,1 1'exemption  du  droit 
de  tonnage  et  de  la  surtaxe  de  pavilion  pour  les  navires  charges 
de  substances  alimentaii'es,2  1'abaissement  du  droit  sur  les  bes- 
tiaux.3  Ce  n'^taient  que  des  mesures  temporaires  ;  mais  elles 
semblaient  indiquer  un  esprit  nouveau. 

Dans  les  deux  camps  opposes  on  s'^mut  M.  Jean  Dollfus  entre- 
prit  une  campagne  contre  la  prohibition  des  fils  de  coton.  Le 
d£but  fut  port6  successivement  devant  la  Soci^t6  industrielle  de 
Mulhouse,  devant  le  Conseil  sup6rieur  du  commerce  et  dans  le 
cabinetde  1'Empereur  :  M.  Dollfus  attaqua,  M.M.  Feray  d'Essonne 
et  Seilliere  defendirent  le  systeme  protecteur.  Le  tai'if  des  colons 
ne  subit  qu'une  modification  16gere  ;4  mais  deja  un  de"cret,  plus 
significatif,  changeait  les  zones  d'entree  pour  la  houille  et  dimin- 
uait,  de  moitie  environ,  le  droit  surlesfers.5  Deux  ans  apres, 
nouvelle  reduction,  et,  comme  consequence,  abaissement  du  droit 
sur  le  fer-blanc,  le  fil  de  fer,  la  vieille  ferraille  et  les  machines.6 
L'ann^e  1855  ^tait  marquee,  en  outre,  par  le  retranchement  de 

1  D<5cret  du  18  aout  1853.    Cette  reTorme  ^tait  alors  demandde  par  le  conseil  municipal  de 
Marseille  et  par  le  conseil  ge"ne"ral  de  l'He"rault  que  pre"sidait  M.  Michel  Chevalier. 

2  Die.  du  8  aout  1853. 

8  Die.  du  14  septembre  1853.  —  Les  droits  sur  boeufs  et  taureaux  dtaient  reduits  de  50  fr. 
*3fr- 

4  Voir  le  de'cret  du  28  ddcembre  1853. 

8  Die.  du  22  novembre  1853.  —  La  diminuition  sur  Pacier  fondu  e'taitmeme  beaucoup  plus 
forte :  de  132  fr.  a  3  fr. 

6  Ddc.  du  7  septembre  1855. 


FRANCE  SOUS  LE  SECOND  EMPIRE.        233 

pres  cle  200  articles  sans  importance,  tels  que  les  yeux  d'ecrevisse 
ou  le  gui  de  chene,  qui  allongeaient  le  tarif  sans  profit  pour  le 
Tresor,1  et  par  une  diminution  importante  du  droit  sur  les  laines 
et  les  peaux  brutes.2  La  tendance  du  gouvernement  s'accusait 
avec  plus  de  nettete\ 

L'Exposition  universelle  de  Paris  venait  d'avoir  lieu  et  1'in- 
dustrie  fran9aise  y  avait  brille  au  premier  rang  parmi  les  nations. 
Dans  le  but  d'epargner  aux  exposants  Strangers  la  la  couteuse 
necessite  de  remporter  leurs  produits,  et  peut-etre  aussi  de  tenter 
une  experience,  le  prince  Napoleon,  president  de  la  Commission, 
avait  fait  decider  que  tous  les  objets  exposes,  qu'ils  fussent  pro- 
hib^s  ou  non,  pourraient  etre  vendus  et  admis  exceptionnellement 
en  France  en  payant  un  droit  de  22  p.  ioo.3  Or,  sur  un  total 
d'environ  22  millions  de  richesses  etrangeres,  qui  avaient  £t£, 
pendant  plusieurs  mois,  etalees  sous  les  yeux  d'un  public  si  nom- 
breux,  2  millions  ^  seulement  avaient  trouve  des  acheteurs 
francais.4  L'industrie  francaise  n'etait  done  pas  aussi  incapable 
de  lutter  centre  la  concurrence  du  dehors  que  le  proclamaient 
les  parties  interessees. 

"  L'observation  qui  m'a  frapp6  tout  d'abord,  disait  le  prince 
Napoleon  dans  son  rapport,  c'est  que  de  ces  grands  concours 
jaillit  une  fois  de  plus  la  preuve  que  les  societes  modernes 
marchent  vers  la  liberte";  deja  le  gouvernement,  desireux  de 
developper  "  les  relations  Internationales  qui  preparent  le  progres 
de  la  civilisation,"  avait  present^  au  Corps  14gislatif  "  un  projet 
levant  toutes  les  prohibitions."  Pour  la  premiere  fois  peut-etre, 
il  avait  rencontr6  une  resistance  qui  Pavait  d'autant  plus  etonne 
qu'elle  etait  plus  rare  et  qu'elle  cherchait  a  prendre  son  point 
d'appui,  hors  de  lassemblee,  dans  1'agitation  des  villes  manu- 
facturieres.  II  retira  le  projet,  en  annonfant  qu'une  nouvelle  loi 
etait  mise  a  1'etude,  et  que  la  levee  des  prohibitions  n'aurait  lieu 
qu'a  partir  du  ier.  juillet  1861.  "  L'industrie  fra^aise,  prevenue 
des  intentions  bien  arrete'es  du  gouvernement,  ajoutait  le 
Moniteur,  aura  tout  le  temps  n^cessaire  pour  se  preparer  a  un 
nouveau  regime  commercial.5 

Durant  trois  ans,  le  silence  se  fit  sur  cette  grave  question.6  D'ail- 
leurs  vers  la  fin  de  1857,  une  crise  terrible  avait  desa^onne  la 

i  D^c.  du  16  juillet  1855.  .          *  D<*c.  du  17  Janvier  etdu  10  ddcember  1855. 

3  T)6c.  du  6  avril  1854.  *  Voir  Journ.  des  £con.,  ze  serie,  t.  xi,p.47i. 

6  Moniteur  du  17  octobre  1856.^ 
6  Cependant  plusieurs  d^crets  importants  furent  rendus. 


234 


SELECTIONS. 


speculation  et  fait  momentanement  refluer  en  baisse  le  prix,  sans 
cesse  montant  depuis  1852,  des  denies,  des  matieres  premieres, 
et,  par  suite,  des  objets  manufactures ;  la  reprise  des  travaux 
avait  ete  suspendue,  en  1859  par  la  guerre  d' Italic. 

Le  commerce  commen9ait  a  peine  a  retrouver  son  equilibre, 
lorsque,  le  15  Janvier  1860,  le  Moniteur  publia  la  lettre  que 
1'Empereur  avait,  quelques  jours  auparavant,  ecrite  a  son  ministre 
des  finances.1  C'erait  un  vaste  programme  economique  dont  le 
but  etait  "  d'imprimer  un  grand  essor  aux  diverses  branches  de  la 
richesse  nationale,"  et  que  son  auteur  rdsumait  en  ces  termes. 

"  Suppression  des  droits  sur  la  laine  et  les  colons ; 

"  Reduction  successive  sur  les  sucres  et  les  cafes ; 

"  Amelioration  energiquement  poursuivie  des  voies  de  com- 
munication. 

"  Reduction  des  droits  sur  les  canaux,  et,  par  suite,  abaisse- 
ment  general  des  frais  de  transport ; 

'k  Prets  a  1'agriculture  et  a  1'industrie  ; 

"  Suppression  des  prohibitions  ; 

"  Traite  de  commerce  avec  les  puissances  etrangeres." 

"  Par  ces  mesures,  ajoutait  1'Empereur,  1'agi'iculture  trouvera 
1'ecoulement  de  ses  produits ;  1'industrie,  aftranchie  d'entraves 
exterieures,  aidee  par  le  gouvernement,  stimulee  par  la  con- 
currence, luttera  avantageusement  avec  les  produits  Strangers  et 
notre  commerce,  au  lieu  languir,  prendra  un  nouvel  essor." 

La  pensee  du  gouvernement,  sur  ce  point,  se  releVait  tout 
entiere.  II  etait  impossible  qu'issu  du  suffrage  universel  et 
degage  des  liens  qui  avaient  arrete  ses  predecesseurs,  il  consentit 
a  maintenir  dans  son  integrite  le  systeme  prohibitif  que  les  gou- 
vernements  precedents  eux-memes  n'avaient  cree  ou  conserve 
aussi  rigoureux  que  par  la  necessite  de  compter  avec  depuissantes 
influences  ;  mais  il  cut  pu  se  faire  qu'un  autre  souverain  embrassfit 
moins  resolument  un  moins  vaste  ensemble.  Quoi  qu'il  en  soit, 
depuis  le  decret  de  Berlin,  aucun  fait  aussi  considerable  ne  s'etait 
produit  dans  1'histoire  de  notre  legislation  douaniere. 

Deja  etaient  arretes  les  articles  du  plus  important  traite  de 
commerce  que  put  signer  la  France,  de  celui  qui  devait  la  Her  a 
sa  rivale  la  plus  redoutee.  Le  heros  dela  ligue  anglaise,  Richard 
Cobden  et  M.  Michel  Chevalier,  qui,  depuis  1852,  faisait  a  chaque 
session  du  Conseil  general  de  THerault,  voter  un  manifeste  en 

i  Lettre  du  5  Janvier  1860. 


FRANCE  SOUS  LE  SECOND  EMPIRE.        235 

faveur  de  la  liberty  commerciale,  en  avaient  eu  les  premiers  la 
pensee,  et  avaient  trouv£  des  dispositions  favorables  dans  le 
ministere  anglais  et  a  la  cour  des  Tuileries.  Au  lendemain  de  la 
paix  de  Villafranca  et  a  la  veille  du  traite  de  Turin,  1'Empereur, 
desireux  de  serrer  les  noeuds  pacifiques  de  la  France  et  de  1'Angle- 
terre,  approuva  un  projet  qui  repondait  aux  besoins  de  sa  politique 
exterieure  comme  a  ses  vues  de  reTormes  £conomiques,  et  des  la 
fin  de  novembre  1859,  les  negociations  preliminaires,  conduites 
avec  le  plus  grand  secret  par  M.  Rouher,  ministre  du  commerce, 
et  par  les  deux  e'conomistes,  etaient  terminees.  Ce  fut  par  la 
lettre  du  5  Janvier  que  la  France  apprit  qu'elle  entrait  dans  une 
nouvelle  ere  industrielle.  Le  23  du  meme  mois,  le  traite  etait 
signe. 

Les  prohibitions  etaient  supprimees.  Les  marchandises 
anglaises  entreraient  en  France  en  payant  un  droit  ad  valorem, 
qui  serait  bientot  converti  en  droit  specifique,  et  qui  n'excederait 
pas  30  pour  100  au  d^but,  25  pour  100  a  partir  de  Pannee  1864. 
La  Grande-Bretagne,  de  son  cote,  admettait  en  pleine  franchise 
nos  produits,  qui  payaient  encore  pour  la  plupart  un  droit  de  10 
pour  100,  et  ne  prelevait  plus  qu'une  taxe  variable  de  i  a  2 
schellings  sur  nos  vins,  et  de  8  schellings  5  pence  sur  nos 
eaux-de-vie. * 

Le  traite  du  23  Janvier  £tait  un  type  sur  lequel  on  se  proposait 
de  reformer  toute  notre  legislation  douaniere,  et  de  regler  les 
rapports  commerciaux  de  la  France  avec  ses  voisins.  Des  nego- 
ciations furent  presque  aussitot  entamees ;  elles  ont  amen6  la 
conclusion  de  plusieurs  traites,  d'abord  avec  la  Belgique,2  puts 
avec  la  Prusse  et  le  Zollverein,3  puis  avec  1'Italie  et  la  Suisse,4 
enfin,  en  1865  et  1866  avec  le"s  Pays-Bas,  les  villes  hans^atiques, 
le  Mecklembourg,  la  Suede,  1'Espagne,  le  Portugal,  le  Perou, 
1'Autriche.5 

Le  Corps  legislatif  ne  fut  saisi  de  ces  reTormes  qu'apr^s  le  fait 
accompli.6  Get  usage  des  droits  confers  au  souverain  par  le 
senatus-consulte  du  25-30  d£cembre  1852,  cut  le  regrettable  effet 

1  Le  traiW  portait  8  sch.  2  pence;  mais  le  taux  fut  trouv^  insuffisant  en  Angleterre  et 
port£  a  8  sch.  5  p.  par  un  art.  addit.  du  20  feVrier. 

2  10  mai  1861.  3  24  mars  et  2  aout  1862,  10  mai  1865. 
4  17  Janvier  1864,  et  30  juin  1864. 

B7Juin  1865,  ii  mars  1865,  9  juin  1865,  4  et  30  juin,  18  juin  1865,11  juillet  1866;  2  dec.,  n 
dec.  1866.  Voir  M.  Boiteau,  Les  Traites  de  commerce  et  Expostde  la  sit.  de  V Empire. 
(Afon.  de  janv.  1866  et  de  fev.  1867.) 

8  La  discussion  sur  les  modifications  de  tarif  du  traite  du  23  Janvier  re  commenc,a  au  Corps 
legislatif  que  le  28  avril. 


236  SELECTIONS. 

de  donner  a  une  transformation  liberale  1'apparence  d'une  coup 
d'Etait  commercial,  et  preta  aux  partisans  de  la  protection  leur  plus 
solide  argument.  Le  gouvernement  tint  bon.  Dans  les  discus- 
sions successives  qu'ont  amenees  les  trait^s,  il  s'est  appliqu£  cons- 
tamment  a  £tablir  des  droits  de  plus  en  plus  moderns,  afin  de  rendre 
toujours  plus  faciles  les  relations  Internationales,1  et  quoique  la 
politique  ait  rendu  vaine  durant  plusieurs  annees  la  Convention 
avec  le  Zollverein,  la  France  communique  aujourd'hui  avec 
toutes  les  nations  limitrophes  de  son  territoire,  sans  rencontrer 
1'obstacle  insurmountable  de  la  prohibition,  et  sans  avoir,  dans  la 
majority  des  cas,  a  payer  autre  chose  qu'un  simple  droit  de  con- 
sommation,  assez  leger  en  fait,  et  legitime  en  principe. 

Ces  trait^s  avaientfait  disparaitre  les  prohibitions.  Le  systeme 
protecteur  qu'elles  etayaient,  et  dans  lequel  de  si  larges  breches 
£taient  ouvertes,  devait  necessairement  crouler.  II  ne  restait  au 
Corps  legislatif  qu'a  d^blayer  le  terrain  et  a  retablir  1'harmonie 
dans  les  diverses  parties  de  notre  Code  douanier,  en  votant  les 
projets  que  lui  pr^sentait  le  gouvernement. 

1  Ainsi,  parexemple,  les  moderations  de  droits  portees  dans  le  trait^  avec  1'Italie,  ont  ^t^, 
par  d^cret  du  20  Janvier  1864,  appliqu^es  a  la  Belgique  et  a  1'Angleterre. 


THE   FRENCH   INDEMNITY.  237 


XII. 

THE    FRENCH   INDEMNITY. 

THE  PAYMENT  OF  THE  FIVE  MILLIARDS. 

BLACKWOOD'S  EDINBURGH  MAGAZINE,  FEB.,  1875,  pp-  172-187. 

As  soon  as  it  became  known,  five  years  ago,  that  France  had 
to  hand  over  £200,000,000  to  Germany,  it  was  generally  predicted 
that  the  financial  equilibrium  of  Europe  would  be  upset  by  the 
tranfer  of  so  vast  a  sum  from  one  country  to  another,  and  that  the 
whole  system  of  international  monetary  relationship  would  be 
thrown  into  confusion.  Apprehensions  of  an  analogous  nature 
were  abundantly  expressed  when  the  two  French  loans  succes- 
sively came  out.  Wise  bankers  shook  their  heads  in  Frankfort, 
London,  Amsterdam,  and  Brussels,  and  assured  their  listeners 
that,  though  the  money  would  probably  be  subscribed,  it  could 
not  possibly  be  paid  up  under  five  years  at  least.  And  yet  the 
whole  of  this  vast  transaction  was  carried  out  between  ist  June, 
1871,  and  5th  September,  1873;  twenty-seven  months  sufficed 
for  its  completion  ;  and  not  one  single  serious  dfficulty  or  disorder 
was  produced  by  it.  The  fact  was  that  the  commercial  world 
had  no  idea  of  its  own  power  ;  it  thought  itself  much  smaller  than 
it  really  is ;  it  failed  altogether  to  suspect  that  its  own  current 
operations  were  already  so  enormous  that  even  the  remittance  of 
five  milliards  from  France  to  Germany  could  be  grafted  on  to 
them  without  entailing  any  material  perturbation.  Such,  how- 
ever, has  turned  out  to  be  the  case  ;  and  of  all  the  lessons  furnished 
by  the  war,  no  other  is  more  practical  or  more  strange.  The 
story  of  it  is  told,  in  detail,  in  a  special  report  which  has  recently 
been  addressed  by  M.  Leon  Say  to  the  Commission  of  the  Budget 
in  the  French  Chamber.  It  is  so  curious  and  instructive  that  it 
is  well  worth  while  to  analyze  it.  It  may,  however,  be  mentioned, 
that  the  order  of  exposition  adopted  by  M.  Say  is  not  followed 
here.  To  render  the  tale  clear  to  Enlish  readers,  the  form  of  it  is 
changed. 

But  before  explaining  the  processes  by  which  the  war  indem- 
nity was  paid,  it  will  be  useful  to  recall  the  principal  features  of 


238  SELECTIONS. 

the  position  in  which  France  was  placed  by  her  defeat.  It  is  now 
computed  that  the  entire  cost  of  the  campaign  amounted,  directly 
and  indirectly,  to  about  £416,000,000;  and  this  outlay  may  be 
divided  into  five  sections,  —  the  first  three  of  which  were  declared 
officially  by  the  Minister  of  Finance  in  his  report  of  28th  October, 
1873,  while  the  two  others  have  been  arrived  at  bv  a  comparison 
of  various  private  calculations.  They  are  composed  as  follows  :  — 

I.  Sums  paid  by  France  for  her  own  military  operations  — 
War  expenses  to  the  end  of  1872  .  .  £76,480,000 
Food  bought  for  Paris  before  the  siege  .  6,781,000 
Assistance  to  families  of  soldiers,  etc.  .  2,000,000 

Balance  of  war  expenses  payable  out  of  the 

Liquidation  Account      ....       21,942,000 

Total  of  French  expenses  proper, 


2.  Sums  paid  to  Germany  — 

Indemnity £200,000,000 

Interest  on  unpaid  instalments  of  indemnity  1 2 ,065  ,oco 
Maintenance  of  German  army  of  occupation  9,945,000 
Taxes  levied  by  the  Germans  ...  2,  468,000 

Total  paid  to  Germany  .         .         .  £224.478,000 

3.  Collateral  expenses  — 

Cost  of  issue  of  the  various  war  loans,  re- 
bates of  interest,  exchange,  and  cost  of 
remitting  the  indemnity  .  .  .  £25,247,000 

Loss  or  diminution  of  taxes  and  revenue  in 

consequence  of  the  war  .  .  .  14,567,000 

Total  of  collateral  expenses        .         .     £39,814,000 

4.  Requisitions  in  cash  or  objects  — 

Supplied  by  towns  or  individuals,  includ- 
ing the  £8,000,000  paid  by  Paris  — 
estimated  at  .....  £15,000,000 

5.  Loss  of  profits  consequent  upon  the  suspension  of  trade  — 

Estimated  at £30,000,000 


THE   FRENCH   INDEMNITY.  239 

RESUME. 

1.  ...         .         .         £107,203,000 

2.  ....  224,478,000 

3-  39,814,000 

4.          ....  15,000,000 

5 30,000,000 

General  Total         .          £416,495,000 

Now,  what  has  France  to  show  against  this? 

Her  annual  gains  before  the  war  were  put  by  M.  Maurice  Block 
("  Europe,  Politique  et  Sociale,"  p.  317)  at  £900,000,000  ;  unfor- 
tunately he  does  not  tell  us  how  much  of  this  she  spends,  and 
how  much  she  lays  by  ;  but  there  is  a  prevalent  impression  in 
France  that  her  annual  savings  amount  to  £80,000,000.  We  shall 
mention  presently  a  calculation  which  seems  to  indicate  that,  during 
the  later  period  of  the  Empire,  they  must  have  amounted  to  a 
considerably  larger  sum  than  this  ;  but  if  we  admit  it,  for  the 
moment,  as  correct,  it  would  follow  that  the  cost  of  the  war,  in 
capital,  represented  five  years'  accumulation  of  the  net  profits  of 
the  country.  It  is  not,  however,  in  that  form  that  a  proportion 
can  be  established  between  liabilities  and  resources  ;  the  measure- 
ment must  be  made,  not  in  capital,  but  in  interest,  for  it  is,  of 
course,  in  the  latter  form  alone  —  that  is  to  say,  in  new  taxation 
to  pay  interest  on  loans  —  that  France  now  feels  the  pressure. 
That  new  taxation,  when  completed  (it  is  not  all  voted  yet),  will 
amount  to  about  £26,000,000  a  year ;  and  that  is  the  real  sum 
which  is  to  be  deducted  from  the  annual  profits  of  the  country 
in  consequence  of  the  war.  Now,  if  those  profits  were  only 
£80,000,000,  and  if  they  are  not  progressing,  but  standing  still 
at  their  previous  rate,  this  deduction  would  absorb  almost  a  third 
of  them,  but  as  they  are  continually  advancing — as  every  branch  of 
trade  in  France  is  active — as  foreign  commerce,  which  is  generally 
accepted  as  a  safe  test  of  national  prosperity,  was  one-fifth  larger  in 
1873  than  in  1869  — it  may  fairly  be  supposed  that,  after  paying  the 
£26,000,000  of  war  taxes,  France  is  effectively  laying  by  as  much 
as  she  did  in  the  best  years  before  the  war,  whatever  that  really  was. 

After  this  rough  indication  of  the  situation,  we  shall  better  un- 
derstand the  story  of  the  five  milliards.  It  is  scarcely  possible  to 
disassociate  it  from  the  general  attendant  circumstances  of  the 
position  as  a  whole ;  the  two  should  be  kept  in  view  together. 


240  SELECTIONS. 

The  payment  of  the  indemnity,  and  the  detailed  conditions 
under  which  that  payment  was  to  be  made,  were  stipulated  in  the 
three  treaties  or  conventions  signed  successively  at  Versailles, 
Ferrieres,  and  Frankfort,  in  January,  March,  and  May,  1871.  It 
was  determined  by  the  last-named  treaty  that  "  payments  can  be 
made  only  in  the  principal  commercial  towns  of  Germany,  and 
shall  be  effected  in  gold  or  silver,  in  English,  Prussian,  Dutch,  or 
Belgian  bank-notes,  or  in  commercial  bills  of  the  first  class." 
The  rates  of  exchange  on  coin  were  fixed  at  3f.  75c.  per  thaler, 
or  at  2f.  I5c.  per  Frankfort  florin  ;  and  it  was  agreed  that  the  in- 
stalments should  be  paid  as  follows  :  — 

30   days   after   the    suppression   of   the 

Commune £20,000,000 

During  1871  ......  40,000,000 

rstMay,  1872 20,000,000 

2d  March,  1874 120,000,000 


Total  .         .  .         .         .     £200,000,000 

The  last  £120,000,000  were  to  bear  interest  at  5  per  cent. 

It  must  be  particularly  observed  that  no  currency  was  to  be 
"  liberative"  excepting  coin,  German  thalers  or  German  florins. 
The  other  forms  of  money  which  the  German  Government  con- 
sented to  accept,  did  not  constitute  a  definite  payment ;  it  was 
not  until  those  other  forms  were  converted  into  their  equivalent 
value  in  thalers  or  in  florins  that  the  .payment  became  "  libera- 
tive." This  was  the  essential  basis  of  the  bargain. 

Furthermore,  it  was  declared  that  the  instalments  must  be  paid 
at  the  precise  dates  fixed,  neither  before  nor  afterwards  ;  and  that 
no  payments  on  account  should  be  allowed.  It  was  not  till  July, 
1872,  that  leave  was  given  to  make  partial  payments,  but  only 
then  with  the  express  reservation  that  such  partial  payments  should 
never  be  for  less  than  £4,000,000  at  a  time,  and  that  one  month's 
notice  of  them  should  be  given  on  each  occasion.  Under  no  circum- 
stances, from  first  to  last,  was  any  payment  permitted  on  account. 

Two  main  conditions,  therefore,  governed  the  operation :  the 
first,  that  all  payments  made  in  anything  but  coin  or  a  proper 
German  form  were  to  be  converted  into  a  German  form  at  the 
expense  of  France  ;  the  second,  that  the  proceeds  of  all  bills  or 
securities  which  fell  due  prior  to  the  date  fixed  for  an  instalment, 


THE   FRENCH    INDEMNITY.  241 

were  to  be  held  over  until  that  date.  The  dates  themselves  were 
ultimately  changed  —  the  last  payment  was  advanced  six  months  ; 
but,  with  two  special  exceptions,  those  conditions  were  rigorously 
enforced  throughout  the  entire  business. 

As  the  annexation  of  Alsace-Lorraine  to  the  German  Empire 
obliged  the  Eastern  Railway  Company  of  France  to  abandon  all 
its  lines  within  those  provinces,  it  was  agreed  that  Germany 
should  pay  for  them,  that  the  price  should  be  £13,000,000,  and 
that  this  sum  should  be  deducted  from  the  indemnity.  This 
was  the  first  exception.  The  second  was,  that  Germany  con- 
sented, as  a  favor,  to  accept  £5,000,000  in  French  bank-notes. 
By  these  two  means  the  £200,000,000  were  reduced  to  £182,- 
000,000.  But  thereto  must  be  added  £12,065,000  for  interest 
which  accrued  successively  during  the  transaction,  and  which 
carried  the  total  for  payment  in  coin  or  German  money  to  £194,- 
065,000.  And  even  this  was  not  quite  all,  for  France  had  to 
furnish  a  further  sum  of  about  £580,000  for  exchange,  and  for 
expenses  in  the  conversion  of  foreign  securities  into  German 
value.  This  last  amount  does  not  appear  to  be  finally  agreed 
between  the  two  Governments  —  there  is  a  dispute  about  it ;  but 
as  the  difference  extends  only  to  a  few  thousand  pounds,  the  final 
sum  remitted  may  be  taken  at  about  £194,645,000,  or  at  £199,- 
645,000,  if  we  include  the  £5,000,000  of  French  bank-notes. 
The  £13,000,000  credited  for  the  railways  carried  the  entire  total 
of  the  indemnity,  with  interest  and  expenses,  to  £212,645,000. 

The  first  payment  (in  French  bank-notes)  was  made  on  ist 
June,  1871.  As  the  first  loan  was  not  brought  out  until  the  end 
of  the  same  month,  £5,000,000  were  taken  for  the  purpose  from 
the  Bank  of  France  ;  but  with  that  exception  and  subject  to  tem- 
porary advances  (as  will  be  seen  hereafter) ,  the  funds  for  the  en- 
tire outgoing  were  provided  by  the  two  great  loans  ;  the  interest 
was,  however,  charged  separately  to  the  budget.  Consequently, 
the  money  was  derived  successively  from  the  following  sources  :  — 

The  value  of  the  Alsace-Lorraine  railways  £13,000,000 

Loan  from  the  Bank  of  France    .         »         .  5,000,000 

Out  of  the  first  loan  for  two  milliards  .         .  62,478,000 

Out  of  the  second  loan  for  three  milliards    .  120,102,000 

Out  of  the  budgets  of  1872  and  1873  (interest),  12,065,000 

Total       ..-;.. £212,645,000 


242  SELECTIONS. 

It  is  not  necessary  to  go  into  the  details  of  the  dealings  with 
the  Bank  of  France,  of  the  subscription  of  the  loans,  or  of  the 
dates  and  proportions  of  the  payments  made  upon  them  ;  it  will 
suffice  to  observe,  as  regards  those  elements  of  the  subject,  that 
though  the  payments  on  the  loans  came  in,  nominally,  before  the 
dates  fixed  for  the  delivery  of  the  corresponding  instalments  to 
Germany,  they,  practically,  were  not  always  available  in  time. 
The  reason  was,  that  though  the  actual  handing  over  to  Berlin 
took  place  at  fixed  periods,  the  remittances  themselves  were 
necessarily  both  anterior  and  continuous,  their  proceeds  being 
accumulated  by  French  agents  until  wanted.  The  result  was 
that  the  French  Ministry  of  Finance  was  under  the  necessity  of 
making  almost  constant  advances  on  account  of  those  remittances. 
Each  time  a  payment  was  coming  due,  the  means  of  effecting  it 
had  to  be  arranged  long  beforehand.  It  is  not  possible  to  collect 
or  carry  £20,000,000  at  a  week's  notice  ;  so  the  Treasury  was  of 
course  obliged  to  keep  on  buying  bills  as  fast  as  it  could  get  them, 
in  order  to  have  a  stock  in  hand  for  future  needs.  That  stock 
fluctuated  a  good  deal,  and  there  is  some  contradiction  in  M. 
Leon  Say's  report  as  to  its  amount ;  but  it  appears,  at  one  period, 
to  have  ranged  for  months  as  high  as  £30,000,000,  part  of  the 
cash  to  pay  for  it  being  provided  temporarily,  until  the  loan 
moneys  came  in,  either  by  Exchequer  bills,  or  by  the  Bank  of 
France  in  notes. 

There  was,  moreover,  towards  the  end  of  the  operation,  an 
advance  made  specially  in  gold  by  the  Bank  of  France  ;  and,  as 
the  circumstances  under  which  it  was  effected  present  a  certain 
interest,  it  will  be  worth  while  to  state  them.  In  May,  1873,  the 
French  Treasury  had  before  it  the  obligation  of  providing 
£40,000,000  between  5th  June  and  5th  September ;  £24,000,000 
of  bills  were  in  hand  for  the  purpose,  and  about  £10,000,000  of 
instalments  were  coming  due  on  the  loan  ;  but  there  was,  at  the 
best,  a  clear  deficit  of  about  £6,000,000  in  the  resources  available. 
The  Bank  of  France  agreed  to  supply  that  sum  ;  but  as,  at  that 
very  moment,  the  circulation  of  its  notes  had  reached  £112,000,- 
ooo,  and  as  it  had,  consequently,  only  a  margin  of  £16,000,000 
between  that  figure  and  its  total  authorized  issue  of  £128,000,000, 
it  seemed  dangerous  to  withdraw  £6,000,000  of  that  margin  in 
notes,  and  it  was  decided  to  effect  the  loan,  by  preference,  in 
gold.  It  is  worth  remarking  that  this  is  probably  the  first  exam- 
ple, in  the  history  of  national  banks,  of  a  bank  electing  to  make 


THE   FRENCH    INDEMNITY.  243 

an  advance  in  gold,  as  being  less  "  dangerous  "  than  the  delivery 
of  its  own  notes.  The  French  Treasury  wasr  of  course,  well 
pleased  to  obtain  bullion,  which  was  immediately  "  liberative," 
instead  of  notes,  which  would  have  had  to  be  converted  into  bills 
at  various  dates.  But,  after  all,  this  aid  did  not  suffice  ;  the  in- 
comings from  the  loan  did  not  arrive,  practically,  in  time  for  use, 
and  the  Treasury  had  to  supply  a  further  final  balance  of  £9,760,- 
ooo  to  enable  the  concluding  payment  to  Germany  to  be  regularly 
effected. 

Finally,  it  may  be  noted  that  there  were  thirty-three  deliveries 
to  Germany,  the  component  parts  of  each  of  which  were  so 
scrupulously  verified  by  the  representatives  of  the  Berlin  Finance 
Department  that  several  days  were  occupied  by  the  counting,  on 
each  occasion.  Indeed,  when  thalers  had  to  be  told  up,  the 
maximum  got  through  in  a  day  never  exceeded  £32,000. 

After  these  preliminary  explanations  we  can  now  begin  to  show 
the  means  by  which  the  transfer  was  performed.  We  will  divide 
them,  in  the  first  instance,  into  four  categories  :  — 

1.  German  bank-notes  and  money  col- 

lected in  France  after  the  war         .  £4,201,000 

2.  French  gold  and  silver      .          .         .  20,492,000 

3.  French  bank-notes    ....  5,000,000 

4.  Bills 169,952,000 


Total  ......     £199,645,000 

The  first  observation  to  be  made  here  is,  that  the  German 
money  found  in  France  amounts  'to  a  singularly  large  sum  ;  in- 
deed, if  this  proof  of  its  importance  had  not  been  furnished,  no 
one  could  possibly  have  suspected  that  the  invaders,  for  their  per- 
sonal and  private  necessities,  had  spent  anything  like  so  much. 
Their  wants,  as  soldiers,  were  supplied,  during  the  war,  either  by 
stores  sent  from  Germany,  or  by  requisitions  levied  in  France  ; 
until  peace  was  signed  they  paid  for  no  objects  of  public  or  offi- 
cial need :  all  this  cash  represented,  therefore,  individual  expen- 
diture. And,  manifestly,  the  teal  total  must  have  been  still  larger. 
It  cannot  be  supposed  that  the  whole  of  the  German  money 
spent  in  France  was  reserved,  by  its  French  proprietors,  for  sale 
to  their  own  Government ;  it  maybe  taken  for  granted  that  a  con- 


244  SELECTIONS. 

siderable  portion  of  it  went  back  straight  to  Germany  through 
ordinary  channels ;  and  it  may  be  guessed  that  the  entire  sum  ex- 
pended by  the  conquerors,  out  of  their  individual  resources,  in 
German  money,  was  at  least  a  half  more  than  the  amount  here 
shown,  and  that  it  consequently  attained  £6,000,000.  The  ques- 
tion is  curious,  and  this  is  the  first  time  that  any  official  informa- 
tion bearing  on  it  has  been  published.  It  remains  to  add,  as 
regards  this  element  of  the  payment,  that,  as  might  have  been 
expected,  the  German  money  was  included,  almost  entirely,  in 
the  earlier  instalments,  and  that  scarcely  any  of  it  appeared  in  the 
later  remittances. 

The  £20,492,000  of  French  money  was  composed  of  £10,- 
920,000  in  gold  and  £9,572,000  in  silver.  But  it  should  be  said 
at  once  that  these  figures  express  only  the  amounts  transmitted  by 
the  French  Government  officially,  and  do  not  comprise  the  quan- 
tities of  French  gold  bought  by  Germany  or  forwarded  by  private 
bankers  to  cover  their  own  bills ;  these  other  quantities  will  be 
referred  to  presently.  £6,000,000  of  the  Government  gold  were 
supplied  by  the  Bank  of  France  ;  the  rest  was  bought  from  dealers 
or  furnished  by  the  Treasury.  Of  the  silver,  £5,840,000  were 
obtained  in  France,  and  £3,732,000  were  drawn,  in  bars,  from 
Hamburg,  and  coined  in  Paris. 

But  these  direct  remittances  of  German  and  French  cash  repre- 
sented, after  all,  only  about  one-eighth  of  the  entire  payment; 
the  other  seven-eighths  were  transferred  by  bills,  and  it  is  in  this 
section  of  the  matter  that  its  great  interest  lies.  It  will  at  once 
be  seen  that,  as  no  remittance  in  paper  became  u  liberative"  until 
it  was  converted  into  an  equivalent  value  in  thalers  or  in  florins, 
the  French  Treasury  could  obtain  no  receipt  for  an  instalment 
until  all  its  various  elements  had  been  so  converted  ;  its  object, 
therefore,  was  to  obtain  the  largest  possible  amount  of  bills  on 
Germany,  so  that,  at  their  maturity,  their  proceeds  might  be  at 
once  available  in  the  prescribed  form.  But,  at  the  same  time,  it 
was  quite  impossible  to  collect  in  France  alone,  within  the  time  al- 
lowed, anything  approaching  to  the  quantity  of  German  bills  re- 
quired. The  result  was,  that  it  was  found  necessary  not  only  to 
hand  in  a  large  amount  of  bills  on  other  countries,  which  had  to 
be  converted  into  German  values  at  the  cost  of  France,  but  also, 
as  regards  the  purchase  of  direct  bills  on  Germany,  to  effect  it 
frequently  in  two  stages.  In  the  first  stage,  bills  were  bought  in 
Paris,  as  they  offered,  on  England,  Belgium,  or  Holland;  in  the 


THE   FRENCH    INDEMNITY.    '  245 

second,  a  portion  of  the  proceeds  of  those  bills  was  reinvested,  in 
those  countries,  in  other  bills  on  Germany  itself.  Of  course  the 
French  Government  was  very  anxious  to  employ  every  sort  of 
means  to  increase  the  quantity  of  German  bills,  and  to  avoid 
leaving  to  the  German  Treasury  the  right  of  converting  foreign 
paper  into  German  value  at  French  expense.  At  the  origin  of 
the  operation  the  importance  of  this  element  of  it  was  not  fully 
realized  ;  but  by  degrees  the  French  minister  discovered  that  it 
was  far  more  advantageous  to  effect  his  conversions  himself  than 
to  leave  them  to  be  carried  out  anyhow  at  Berlin.  The  result  of 
this  discovery  was,  that  while  £454,000  were  paid  to  Germany 
for  the  cost  of  conversion  on  the  first  two  milliards,  only  £11,000 
were  paid  to  her  under  the  same  head  on  the  remaining  three 
milliards  ;  after  the  experience  of  the  first  twelve  months, 'France 
sought  for  bills  on  Germany  wherever  she  could  get  them,  all 
over  Europe  ;  and  it  may  be  added  that  she  was  somewhat  aided  in 
the  effort  by  the  special  position  of  Germany,  who,  at  the  moment, 
was  in  debt  considerably  to  England  not  only  for  the  war  loans  she 
had  issued  there,  but  also  on  commercial  account  as  well.  But,  as 
has  just  been  mentioned,  a  good  many  of  these  bills  were  sub- 
stitutions for  each  other,  and,  consequently,  the  amount  of 
paper  shown  as  bought  is  considerably  larger  than  the  real 
sum  paid  to  Germany,  the  reason  being  that  a  good  deal  of 
it  appears  in  the  account  twice  over.  The  following  table 
gives  the  composition  of  the  total  quantity  of  bills  bought  by 
France  :  — 

Bills  on  Germany,  bought  direct,  in  thalers         .  £62,550,000 

Do.                                    do.            in  florins          .  9,548.000 
Do.                          bought,  in   thalers,  with  the 

proceeds  of  other  bills        .  42,218,000 

Do.                          in  reichsmarcs       .          .          .  3,172,000 

Do.    England,  in  sterling         ....  61,780,000 

Do.    Hamburg,  in  marcs-banco       .          .          .  21,432,000 

Do.    Belgium,  in  francs  .....  20,856,000 

Do.    Holland,  in  florins  .          ....  12,952,000 


Total £234,508.000 

These  bills  were  paid  for,  mainly,  in  French  bank-notes  ;  and 


246  SELECTIONS. 

the  average  rates  of  exchange  at  which   they  were  bought  came 
out  as  follows,  for  the  entire  operation  :  — 


Thalers 3-7910 

Pounds  sterling          .....  25.4943 

Marcs-banco 1.9089 

Belgian  francs 1.0061 

Dutch  florins     ......  2.1500 

Frankfort  florins        .         .         .         .         .2.1637 

Reichsmarcs     .         .                   .      "  .      '    »  1.2^28 


Every  one  at  all  acquainted  with  exchanges  will  recognize  how 
low,  under  such  ciixumstances,  these  prices  are  ;  and  will  ask, 
with  wonder,  how  they  can  have  been  kept  down  to  such  averages 
on  so  large  an  undertaking. 

But  though  the  foregoing  table  shows  the  quantities  of  bills,  of 
each  kind,  that  were  bought  by  the  French  Government  as 
vehicles  of  transmission,  it  in  no  way  indicates  the  form  in  which 
the  money  was  in  reality  handed  over  to  the  German  Treasury. 
Most  of  the  above  figures  were  largely  modified  by  conversions 
and  substitutions  ;  and  when  all  the  bills  had  been  cashed  —  when 
the  whole  payment  had  been  effected  —  it  appeared  that  the  real 
totals  of  each  sort  of  currency  which  had  been  finally  delivered 
to  Germany  were  as  follows  :  — 

French  bank-notes  ....  £5,000,000 

French  gold    .         .         .         .         .  10,920,000 

French  silver .         .         .         .         .  9,572,000 

German  notes  and  cash  .         .         .  4,201,000 

Bills  —  Thalers       .         .         .         .  99,412,000 

Do.  — Frankfort  florins      i     .         .  9,404,000 

Do.  —  Marcs-banco        .         .         .  10,608,000 

Do.  — Reichsmarcs        .         .         .  3,190,000 

Do.   —  Dutch  florins       .         .         .  10,020,000 
Do.  —  (and    in    silver)  —  Belgian 

francs      .         .         ...  11,828,000 

Do.  —  Pounds  sterling  .         .         .  25,490,000 


Total £199,645.000 


THE   FRENCH   INDEMNITY.  247 

•  This  catalogue  shows,  at  last,  in  what  shape  the  bills  were 
really  utilized  and  made  "  liberative,"  either  in  German  money 
direct,  or  by  the  equivalent  of  foreign  value  in  thalers  or  florins. 
The  differences  of  composition  between  this  definitive  list  and 
that  of  the  bills  originally  bought,  are  only  partially  explained  by 
M.  L£on  Say ;  it  is  not,  however,  necessary,  nor  would  it  be 
interesting,  to  follow  out  precisely  the  various  conversions  which 
took  place; — we  will  only  mention,  as  an  illustration,  that,  out 
of  the  £61,780,000  of  original  bills  in  England,  £31,687,000  were 
converted  here  into  other  bills  on  Germany,  that  £25,490,000 
were  sent  to  Berlin  in  sterling  bill,  and  that  the  balance  remains 
unexplained.  As  regards  the  direct  delivery,  by  France  herself, 
of  English,  Belgian,  or  Dutch  bullion,  the  report  says  nothing; 
it  is  only  stated,  incidentally,  that  £720,000  of  Belgian  francs 
were  sent  to  Berlin  in  metal,  and  that  the  London  agency  of  the 
French  Treasury  bought  £1,132,000  here  in  gold  and  silver, 
which,  probably,  was  also  shipped  to  Berlin ;  but  these  are  the 
sole  allusions  to  the  subject.  It  is  probable,  as  indeed  has  always 
been  supposed,  that  the  bullion  which  was  withdrawn,  during  the 
operation,  from  London,  Brussels,  and  Amsterdam,  was  not  taken 
for  French  account,  but  by  Germany,  out  of  the  sums  at  her  dis- 
posal in  each  place  after  the  bills  on  that  place  had  matured. 

We  have  now  before  us,  in  a  condensed  form,  the  main  ele- 
ments of  this  prodigious  operation;  we  see  now  what  were  the 
conditions  which  regulated  it,  where  the  money  came  from  to 
realize  it,  how  that  money  was  successively  employed,  and  in 
what  shapes  the  payments  were  at  last  effected. 

We  recognize  that  France  herself  provided,  in 

her  own  notes  and  coin  .         .         £25,492,000 
"  that  German  money  and  bills  on 

Germany  produced  .          .          .  126,815,000 

"  and  that  bills  on  England,  Bel- 

gium, and  Holland  contributed  47,338,000 


Total £199,645,000 


Here,  however,  we  must  repeat  that  the  Paris  bankers  who  sold 
drafts  on  Germany  were  obliged,  to  some  extent,  to  remit  cash  to 
meet  them.  On  this  point  M.  Leon  Say  goes  into  calculations 


248  SELECTIONS. 

which  we  will  mention  presently ;  for  the  moment  it  will  suf- 
fice to  say  that,  according  to  his  view,  the  effective  transmission 
of  bullion  from  France  to  Germany,  through  private  hands,  from 
1871  to  1873,  did  not  exceed  £8,000,000  for  the  purposes  in  view 
here.  He  acknowledges,  as  will  be  seen,  that  the  entire  exporta- 
tion of  French  gold  during  the  three  years  reached  (probably) 
£40,000,000 ;  but  still  he  expresses  the  opinion  that  £8,000,000 
were  all  that  was  required,  as  a  balance,  to  cover  the  French  bills 
on  Berlin.  Of  course  this  is  a  question  which  nobody  can  de- 
cide ;  but,  to  lookers  on,  it  does  seem  somewhat  contrary  to  the 
probabilities  of  such  a  case  that  this  sum  can  have  been  suffi- 
cient. It  may,  perhaps,  have  been  enough,  as  M.  Say  says,  to 
balance  accounts  in  the  long-nan,  but  it  is  difficult  to  believe  that 
it  was  not  considerably  exceeded  while  the  operation  was  under 
execution.  Furthermore,  M.  L6on  Say  makes  a  mistakes  of 
£10,000,000  in  his  account,  as  we  shall  show  ;  and,  for  that  rea- 
son, we  believe  that  £18,000,000  instead  of  £8,000,000  were  re- 
quired, so  putting  the  whole  total  of  French  bullion  temporarily 
used,  including  the  £20,000,000  of  the  Government,  at  about. 
£38,000,000,  or  a  little  more  than  one-sixth  of  the  entire  sum  to 
pay.  As  this  is  certainly  a  maximum,  it  follows  that  France  got 
out  of  this  great  debt  with  a  payment  of  only  18  per  cent,  of  it, 
at  the  outside,  in  her  own  money.  And  there  is  good  reason  to 
suppose  that  all  the  gold  exported  by  her  has  come  back,  and 
that  her  reserves  of  bullion  are  reconstituted  at  present  as  they 
were  before  the  war. 

And  now  we  can  approach  the  most  important  and  interesting 
point  in  the  whole  transaction.  How  came  it  that  £170,000,000 
of  bills  could  be  got  at  all  ?  We  have  given  a  general  answer  to  the 
question  at  the  commencement  of  this  article  ;  we  will  now  con- 
sider it  more  in  detail,  partly  with  the  aid  of  M.  Le"on  Say's 
report,  partly  by  reference  to  other  sources  of  information.  It 
appears,  as  might  have  been  expected,  that  various  measures  were 
employed  by  the  French  Government  in  order  to  render  possible 
the  collection  of  such  a  huge  mass  of  paper.  In  the  first  place, 
particular  facilities  and  temptations  were  offered  to  foreigners  to 
induce  them  to  subscribe  to  the  two  loans  ;  commissions  varying 
from  £  to  i  per  cent,  were  offered  to  them,  —  the  object  being  to  ac- 
quire the  power  of  drawing  on  them  for  the  amount  of  their  instal- 
ments. Secondly,  everything  was  done  to  encourage  anticipated 
payments  of  those  instalments,  so  as  to  hasten  the  dates  at  which 


THE   FRENCH   INDEMNITY.  249 

they  could  be  drawn  for.  Thirdly,  as  some  fear  was  felt  that  the 
second  loan  might  possibly  not  be  eagerly  subscribed,  coming,  as 
it  did,  so  immediately  after  a  previous  issue  which  was  not  quite 
paid  up,  it  was  thought  desirable  to  get  a  portion  of  it  guaranteed 
by  bankers.  But,  in  order  not  to  risk  giving  to  those  bankers  a 
large  commission  for  nothing,  it  was  stipulated  with  them,  as  a 
part  of  the  arrangement,  that  they  should  supply  the  Treasury 
with  a  fixed  quantity  of  foreign  bills.  By  the  two  former  plans 
of  action  the  immense  amount  of  £70,920,000  of  drafts  on  other 
countries  was  obtained,  £15,960,000  of  which  were  on  account 
of  the  first  loan,  and  £54,960,000  on  account  of  the  second  ;  and 
it  may  be  remarked  at  once,  before  we  proceed,  that  though  this 
figure  supplies  decisive  evidence  of  the  fact  that  at  least  one-third 
of  the  two  great  loans  was  paid  up  by  foreign  subscribers,  it  is 
certain  that  nearly  the  entire  amount  has  been  bought  back  since, 
and  that  almost  the  whole  of  the  new  stocks  is,  at  the  present 
moment,  in  French  hands.  By  the  third  plan,  the  bankers  who 
formed  the  syndicate  —  and  it  may  be  mentioned  that  fifty-five  of 
the  first  houses  in  Europe  were  associated  for  the  purpose  — 
engaged  to  supply  £28,000,000  of  paper.  Consequently,  by 
these  admirably  devised  schemes,  £98,920,000  of  drafts  were 
successively  procured,  and  the  exact  quantity  to  be  bought  in  the 
open  market  was  reduced  to  £71,032,000. 

It  must,  however,  be  observed,  that  though  we  can  regard  these 
drafts  on  foreign  countries  for  loan  instalments  as  a  special  prod- 
uct of  the  occasion,  and  are  therefore  justified  in  counting  them 
apart,  the  same  cannot  anyhow  be  said  of  the  £28,000,000  of 
bills  furnished  by  the  syndicate  of  bankers.  The  latter  were 
evidently  composed  of  ordinary  commercial  paper,  and  conse- 
quently must  be  added  to  the  total  which  had  to  be  sup- 
plied from  commercial  sources  proper,  so  putting  that  total 
at  £99,032,000.  Now,  bills  of  this  sort  necessarily  imply 
an  effective  counter-value  of  some  kind ;  so,  as  we  have  already 
seen  that  at  the  outside  only  £18,000,000  of  that  counter- 
value  was  supplied  in  bullion,  there  remained  at  least  £81,032,- 
ooo  of  bills  which  must  necessarily  have  been  based  on  ordinary 
trading  or  financial  operations.  What  were  those  operations? 
Very  often  the  general  character  of  a  bill  is  indicated  on  its  face  ; 
but  in  this  case  a  test  of  that  kind  could  not  be  applied,  not  only 
because  there  were  so  many  bills  to  handle  that  a  serious  exami- 
nation of  their  nature  was  impracticable  (there  were,  in  all,  one 


250  SELECTIONS. 

hundred  and  twenty  thousand  of  them,  of  every  conceivable  amount 
from  £40  to  £200,000),  but  also  because  every  possible  kind 
of  business  transaction  must  have  been  represented  in  that  accu- 
mulation of  securities  from  all  parts  of  the  world.  Bank  credits, 
circulation  bills,  settlements  for  goods  delivered,  remittances  on 
account  of  future  purchases,  drafts  against  the  coupons  of  shares 
and  stocks,  special  paper  created  for  the  occasion,  —  all  these 
forms,  and  many  others,  too,  were,  according  to  M.  L£on  Say, 
included  in  the  collection.  It  was  not  possible  to  seek  out  in 
detail  the  origins  and  meanings  of  such  a  varied  mass ;  but  we 
may  take  M.  Say's  general  description  of  it  to  be  true,  not  only 
because  it  corresponds  with  probabilities  and  experience,  but  also 
because  he  was  himself  Minister  of  Finance  during  a  part  of  the 
operation,  and  has  therefore  a  personal  knowledge  of  its  main  cir- 
cumstances. Researches,  however,  which  could  not  be  attempted 
with  the  bills  themselves,  may  be  practically  and  usefully  pursued 
if  they  are  directed  towards  the  general  signs  and  symptoms  of 
the  financial  state  of  France.  It  is  probable  that  a  relatively 
small  amount  of  bills  was  created  specially  to  be  sold  to  the 
French  Government.  We  may,  indeed,  take  the  supposed 
£18,000,000  of  exported  bullion  as  indicating  the  approximate 
extent  of  uncovered  or  manufactured  paper ;  all  the  rest  was 
evidently  based  on  mercantile  transactions.  Now,  we  know  that 
mercantile  transactions  imply  the  delivery  of  property  of  some 
kind,  and  that  the  two  main  forms  of  property,  commercially, 
are  merchandise  and  stocks.  It  is  therefore  necessary,  in  order  to 
arrive  at  an  idea  upon  the  question,  to  glance  at  the  actual  posi- 
tion of  France  in  her  dealings  with  other  nations  in  these  two 
values. 

We  have  already  alluded  to  the  development  of  French  trade, 
and  to  the  general  influence  of  that  development  on  the  payment 
of  the  war  indemnity  as  a  whole ;  but  we  must  go  into  a  few 
figures  here  in  order  to  make  the  bearings  of  the  subject  clear. 
The  value  of  the  foreign  commerce  of  France  —  importations  and 
exportations  together  —  was  £257,000,000  in  1871,  £293,000,000 
in  1872,  and  £301,000,000  in  1873.  Now,  it  will  be  at  once 
recognized  that  the  amount  of  bills  necessitated  by  this  quantity 
of  commerce  supplied  a  solid  foundation  for  carrying  the  addi- 
tional paper  whose  origin  we  are  now  seeking  to  discover.  M. 
Say  is  of  opinion  that  scarcely  any  part  of  the  indemnity  bills  was 
furnished  by  the  current  commercial  trade  of  the  country  ;  but,  as 


THE   FRENCH    INDEMNITY.  251 

we  have  just  seen  that  the  quantity  required  from  trading  sources 
•was  £81,000,000,  or  about  £40,000,000  per  annum,  it  does  seem 
to  be  possible,  notwithstanding  his  contrary  irnpression,  that  some 
portion  of  that  relatively  reduced  quantity  may  have  been  found 
in  the  ordinary  commercial  movement.  For  instance,  it  may 
reasonably  be  argued — as  indeed  M.  Say  himself  admits  —  that 
bills  drawn  against  French  exports  to  Germany  or  England  would 
be  included,  to  some  extent,  amongst  those  which  were  offered 
to  the  Government.  There  seems  to  be  no  reason  why  this 
should  not  have  been  so. 

But  if  M.  Say  considers  that  the  habitual  commercial  paper  of 
France  has  not  been  of  much  service  to  the  Treasury  in  its  con- 
duct of  this  operation,  he  holds  a  totally  different  opinion  with 
reference  to  the  influence  of  the  foreign  investments  of  the  French 
people.  What  he  says  on  this  subject  is  new  and  curious,  and  is 
well  worth  repeating. 

He  begins  by  stating,  with  an  appearance  of  much  truth  and 
reason,  that  for  many  years  before  the  war,  French  capital  was 
being  continuously  invested  in  foreign  securities;  that  the  sums 
so  placed  have  been  estimated  by  different  economists  at  from 
£30,000,000  to  £60,000,000  a  year.  Here,  however,  before  we 
follow  out  his  argument,  we  must  open  a  parenthesis,  and  observe 
that  if  even  the  smaller  of  these  figures  is  exact,  the  computation 
of  £80,000,000  of  annual  savings,  which  was  alluded  to  at  the 
commencement  of  this  article,  must  be  altogether  wrong.  It  is 
manifestly  inadmissible  that  France  can  have  been  investing  in 
foreign  countries  three-eighths  of  her  whole  net  yearly  profits. 
Consequently,  we  may  legitimately  suppose  that  the  popular  im- 
pression about  the  £80,000,000  is  a  delusion,  and  that  France  is 
in  reality  laying  by  a  vast  deal  more  than  that.  If  so,  the  ease 
and  speed  with  which  she  has  recovered  from  the  war  would  be 
comprehensibly  explained.  M.  Leon  Say  goes  on  to  tell  us  that 
French  investments  in  foreign  stocks  amounted  in  1870  to  so  large 
a  total,  that  the  dividends  on  them  represented,  at  that  date,  about 
£25,000,000  a  year,  for  which  sum  drafts  on  other  countries  were 
of  course  put  into  circulation  by  its  French  proprietors.  Further- 
more, the  revenues  of  the  strangers  who  live  in  France  come  to 
them  principally  from  their  own  country  ;  and  it  is  estimated  that, 
before  the  war,  £10,000,000  or  £12,000,000  of  such  incomes 
were  drawn  for  annually  in  the  same  way.  Consequently,  on  this 
showing,  it  would  appear  that  somewhere  about  £35,000,000  or 


252  SELECTIONS. 

,£40.000,000  of  French  drafts  on  foreign  countries  were  created 
every  year  from  those  two  sources.  It  is,  however,  certain  that 
this  quantity  has  diminished  since  the  war,  by  the  departure  of 
some  of  the  strangers  who  used  to  live  in  France,  and  also  by  the 
sale,  in  order  to  provide  funds  for  subscription  to  the  two  new 
loans,  of  some  of  the  foreign  securities  held  in  France.  But  M. 
L£on  Say  considers  that  the  annual  diminution,  on  both  heads 
together,  does  not  exceed  £4,000,000,  and  that  at  least  £30,000,- 
ooo  of  paper,  representing  cash  due  to  France  on  account  of  in- 
comes from  abroad,  irrespective  of  commerce  properly  so  called, 
were  drawn  in  1871  and  1872.  In  support  of  these  considera- 
tions, he  mentions,  amongst  other  facts,  that  in  1868  and  1869  the 
coupons  paid  in  Paris  on  Italian  stock  alone  amounted  to  £3,- 
400,000 ;  while  in  1872  and  1873  they  fell  to  £2,400,000.  On 
this  one  security,  therefore,  —  which  is,  however,  probably  held 
in  France  in  larger  proportions  than  any  other  foreign  stock,  —  the 
diminution  of  income  since  the  war  amounts  to  £1,000,000. 
With  these  figures  and  probabilities  before  him,  he  concludes  by 
expressing  the  confident  opinion  that,  as  French  purchases  of 
foreign  stocks  have  ceased,  to  a  great  extent  at  least,  since  1870, 
and  as  remittances  of  French  money  to  pay  for  such  purchases 
have  consequently  ceased  as  well,  the  drafts  on  other  countries  for 
coupons  and  revenues  became  entirely  disposable  for  transmission 
to  Berlin,  and  that  it  is  here  that  the  main  explanation  lies  of  the 
facility  with  which  the  bills  were  found.  This  theory  is  ingen- 
ious, and  it  is  probably,  in  great  part,  true. 

The  movement  of  the  precious  metals  forms  a  separate  element 
of  the  subject,  and  one  that  is  not  easy  to  trace  out ;  for  in  France, 
as  in  most  other  countries,  the  public  returns  of  the  international 
trade  in  specie  are  very  incomplete.  We  know  how  much  gold 
and  silver  are  raised  from  mines,  and  how  much  thereof  is  coined 
by  each  country  ;  but  we  are  very  ill  informed  as  to  what  becomes 
of  them  when  once  they  have  issued  from  the  mint.  On  this 
head  also,  however,  M.  L£on  Say  has  collected  some  valuable 
facts.  The  Custom-house  Reports  inform  us  that  during  the 
three  years  from  1871  to  1873,  £53,400,000  of  bullion  were  ex- 
ported, and  £50,480,000  were  imported  ;  on  this  showing,  there- 
fore, the  loss  of  bullion  was  only  £2,920,000.  But  as  private 
information  gave  good  reason  to  believe  that  the  amounts  must 
have  been  in  reality  considerably  larger,  calculations  have  been 
made  in  order  to  arrive  at  a  more  correct  conclusion.  It  appears, 


THE   FRENCH   INDEMNITY.  253 

from  official  publications,  that  the  stock  of  gold  and  silver  in  the 
Christian  world  is  supposed  to  have  increased  by  £371,000,000 
from  1849  to  1867  ;  but  the  augmentation  has  not  occurred  in 
both  the  metals  —  it  has  taken  place  in  gold  only  ;  the  quantity 
of  gold  is  greater  by  £428,000,000,  'while,  in  consequence  of 
exportations  to  Asia,  the  quantity  of  silver  has  diminished  by 
£57,000,000.  Now,  out  of  this  £428,000,000  of  new  gold, 
France  alone,  in  the  first  instance,  received  more  than  half;  at 
least  we  are  justified  in  supposing  so,  from  the  fact  that,  during 
the  same  period,  the  Paris  mint  converted  £230,000,000  of  bar 
gold  into  French  coin.  Of  course  this  quantity  of  gold  did  not 
remain  permanently  in  France  ;  its  whole  value  was  not  added  in 
reality  to  the  general  French  stock  of  metal ;  as  gold  arrived  in 
France  silver  went  away ;  indeed  it  is  imagined  that,  out  of  the 
£200,000,000  of  silver  which  have  been  coined  in  France  since 
the  year  1800,  only  £40,000.000  remained  in  the  country  in  1869. 
It  is,  however,  calculated  that  the  £100,000,000  of  hard  cash, 
gold  and  silver  together,  which  were  said  to  really  belong  to 
France  in  1848,  have  doubled  since  ;  and  M.  Wolowski,  who  is 
regarded  as  an  authority  on  such  questions,  declared  in  the  French 
Chamber,  on  4th  February  last,  that,  in  his  opinion,  the  national 
stock  now  ranges  between  £200,000,000  and  £250,000,000. 

But  whatever  be  the  interest  of  these  computations,  and  useful 
as  it  may  be  to  count  up  the  amount  of  bullion  which  has  come 
into  France,  we  must  look  elsewhere  for  information  as  to  the 
quantity  of  it  which  the  consequences  of  the  war  took  out.  We 
know  that  the  German  mint  melted  down,  for  its  own  coinage, 
£33,880,000  of  French  napoleons.  It  is  also  known,  says  M. 
Leon  Say,  that  the  Bank  of  England  bought  nearly  £8,000,000 
of  the  same  sort  of  money  between  1870  and  1873.  Here,  there- 
fore, we  can  trace  the  passage  out  of  France,  since  the  war,  of 
nearly  £42,000^000  of  her  gold.  But,  as  Germany  drew  from 
London  £1,680,000  of  the  napoleons  which  she  put  into  the  fur- 
nace, it  may  be  that  that  sum  was  included  in  the  £8,000,000  of 
the  Bank  of  England,  and  is  therefore  counted  twice.  For  this 
reason  the  amount  really  sent  to  Germany  and  England  may  be 
put  at  £40,000,000.  M.  Leon  Say  adds,  that  the  Bank  of  Am- 
sterdam bought  a  further  £3,600,000  of  French  gold  ;  but,  as  he 
fancies  that  this  may  not  have  come  direct  from  France,  he  does 
not  add  it  to  the  total,  and  he  holds  to  £40,000,000  as  represent- 
ing probably  the  effective  loss  of  gold  which  France  had  to  sup- 


254  SELECTIONS. 

port  after  the  war.  Of  this  sum,  £10,920,000  were  exported  to 
Berlin,  as  we  have  already  shown,  by  the  French  Government 
itself;  the  other  £29,080,000  were  consequently  carried  out  by 
private  firms  for  transmission  to  Berlin,  and  for  various  other 
purposes.  Silver,  however,  arrived  in  considerable  quantities  to 
replace  the  gold.  £9,500,000  of  silver  were  coined  in  Paris 
between  1870  and  1873  ;  and  the  Custom-house  returns,  which 
are  almost  always  below  the  truth,  show  an  importation  of 
£12,160,000  of  it.  From  all  this,  M.  Say  concludes  that 
£40,000,000  of  gold  left  France;  that  £12,000,000  of  silver  came 
to  her ;  and  that  the  £28,000,000  of  difference  between  the  two 
represents  the  real  total  loss  of  bullion  which  the  war  entailed. 

But  in  making  this  calculation  M.  L6on  Say  commits  a  most 
wonderful  mistake ;  he  entirely  omits  to  take  account  of  the 
£9,572,000  of  silver  which  the  French  Government  sent  to  Ber- 
lin, and  which  must,  of  course,  be  added  to  the  outgoing.  When 
this  strange  error  is  corrected,  the  loss  becomes,  not  £28,000,000, 
but  £38,000,000,  of  which  the  Government  exported  £20,000,- 
ooo,  —  leaving,  apparently,  £18,000,000,  instead  of  £8,000,000, 
as  the  sum  contributed  by  private  bankers.  This  difference  of 
£10,000,000  in  the  issue  of  the  calculation  gives  some  value  to 
another  computation  which  M.  Ldon  Say  has  made,  but  which 
would  have  had  no  foundation  if  this  error  had  not  existed.  He 
says  —  probably  with  some  truth  —  that  the  quantity  of  money  in 
circulation  in  a  country  remains  usually  at  the  same  general  total, 
during  the  same  period,  whatever  be  the  nature  of  the  various 
elements  which  compose  it.  He  then  goes  on  to  argue  that  as 
the  issue  of  French  bank-notes  was  £44,000,000  higher  in  Sep- 
tember, 1873,  than  in  June,  1870,  that  increase  ought  to  approxi- 
mately indicate  the  amount  of  metal  withdrawn  in  the  interval 
from  circulation,  and  replaced  by  notes.  But,  according  to  his 
theory,  that  amount  of  metal  did  not  exceed  £28,000,000,  leaving 
an  excess  of  £16,000,000  of  notes,  which  excess  he  explains  by 
saying  that  it  represents  an  equal  sum  in  gold  which  the  French 
people  had  hidden  away  !  Now,  everybody  knows  that  the  lower 
classes  of  the  French  people  do  hide  money — do  u  thesaurise," 
as  they  say  ;  but  such  an  explanation  of  the  missing  £16,000,000  is 
so  purely  imaginary  that  it  cannot  merit  any  serious  credit.  The 
theory  assumes,  however,  a  very  different  form  when  the  error  of 
the  £10,000,000  is  corrected.  In- that  case  we  have  an  extra 
issue  of  £44,000,000  in  bank-notes,  corresponding  to  a  loss  of 


THE   FRENCH    INDEMNITY.  255 

£38,000,000  in  gold  and  silver ;  and  there  the  two  figures  get 
sufficiently  close  to  each  other  for  it  to  be  possible  that  there  really 
is  some  relationship  between  them,  without  being  forced  to  resort 
to  the  possible  but  improbable  solution  of  thesaurising. 

Consequently,  with  all  these  various  considerations  before  us, 
it  seems  reasonable  to  suppose  that  the  natures  of  the  bills  em- 
ployed to  pay  the  war  indemnity  were  of  three  main  classes,  and 
were  grouped  approximately  in  the  following  proportions  :  — 

Drafts  for  foreign  subscriptions  to  the  loans         .  £70,920,000 

Bills  against  French  bullion  specially  exported,  18,000,000 
Commercial  bills  and  drafts  for  dividends  and 

revenues  from  abroad     .         ,         .         .         .  81,032,000 


General  total  of  bills  .          .         .         .          .        £169,952,000 

Before  we  proceed  to  sum  up  the  case,  and  to  try  to  draw  from 
it  the  teaching  it  contains,  there  is  one  more  detail  which  is  worth 
explaining. 

We  have  alluded  to  the  coining  in  Paris  of  a  certain  quantity 
of  Hamburg  silver.  To  make  the  story  of  it  clear,  it  is  necessary 
to  remind  our  readers  that,  according  to  the  constitution  of  the 
Bank  of  Hamburg,  —  which  dates  from  1619,  —  accounts  were 
kept  by  it  in  a  money  called  marc-banco,  and  credits  were  opened 
by  it  in  that  money  on  the  deposit  of  silver,  —  coined  or  uncoined. 
—  the  value  of  that  silver  being  calculated  pure.  By  degrees  the 
marc-banco,  though  only  an  imaginary  money,  grew  to  be  the 
universal  denominator  employed  in  the  home  and  foreign  business 
of  Hamburg  ;  it  acquired  an  importance  greater  than  that  of  the 
effective  money  of  many  German  states.  But  when  the  Empire 
was  established,  and  it  was  decided  to  introduce  a  gold  standard 
into  Germany,  it  became  essential  to  suppress  the  marc-banco, 
for  it  had  the  double  defect  of  representing  silver  and  of  forming 
a  separate  value  outside  German  monetary  unity.  So  it  was 
abolished  bylaw  and  ordered  to  disappear,  —  the  plan  adopted 
being  that  the  Bank  of  Hamburg  should  liquidate  its  deposits  by 
paying  off,  in  pure  silver,  the  marcs-banco  in  circulation.  It 
was,  however,  stipulated  that  this  right  should  cease  on  I5th 
February,  1873,  and  that,  after  that  day,  all  persons  who  held 
securities  in  marcs-banco  should  lose  the  old  right  of  receiving 


256  SELECTIONS. 

pure  silver,  and  should  only  be  entitled  to  half  a  thaler  for  each 
marc-banco,  that  being  the  value  of  the  silver  represented  by  the 
latter.  Now,  the  French  Treasury  had  bought,  as  we  have  seen, 
£21,000,000  of  bills  in  marcs-banco,  and,  consequently,  possessed 
the  right  of  claiming  silver  for  such  of  them  as  fell  due  before 
I5th  February,  1873,  while  all  the  rest,  from  that  date,  were  pay- 
able in  thalers.  The  thaler  was  "  liberative,"  while  the  marc- 
banco  was  not ;  but  the  pure  silver  which  the  marc-banco  repre- 
sented could  be  coined  into  five-franc  pieces,  and  be  delivered  to 
the  German  Government  at  the  rate  of  3  francs  75  centimes  per 
thaler.  The  result  was,  that  being  by  far  the  largest  holder  of 
marcs-banco  paper,  the  French  Treasury  was  able  for  a  time  to 
control  the  Hamburg  market,  and  it  naturally  used  for  its  own 
advantage  the  power  which  this  position. gave  it.  The  Hamburg 
Bank  was  utterly  unable  to  deliver  the  quantity  of  silver  for  which 
France  held  acceptances  in  marcs-banco  ;  it  was  absolutely  in  the 
hands  of  the  French  Minister  of  Finance  ;  that  functionary  ap- 
pears, however,  to  have  acted  very  fairly,  —  to  have  only  asked 
for  silver  in  moderation,  and  to  have  profited  by  his  power  solely 
to  obtain  conversions  into  thalers  on  good  conditions.  The  result 
was,  as  we  have  said,  that  £3,732,000  of  Hamburg  silver  came 
to  the  Paris  mint,  partly  through  Government  importations  on 
marcs-banco  bills,  partly  through  private  speculators,  who  followed 
the  example  of  the  Treasury,  and  pressed  the  Hamburg  Bank  for 
metal. 

Such  are,  in  a  condensed  form,  the  essential  features  of  the 
history  of  this  extraordinary  operation  ;  and  now  that  we  have 
completed  the  account,  we  need  no  longer  delay  the  expression  of 
our  admiration  of  the  consummate  ability  with  which  it  was  con- 
ducted. Its  success  may  be  said  to  have  been,  in  every  point, 
complete  ;  we  cannot  detect  one  sign  of  a  grave  hitch  or  of  a 
serious  error  in  it.  It  does  the  highest  honor  to  the  officials  of 
the  French  Treasury,  and  proves  that  they  possess  a  perfect 
knowledge  of  exchange  and  banking,  both  in  their  minutest  de- 
tails and  in  their  largest  applications. 

When  we  look  back  upon  the  subject  as  a  whole,  three  great 
facts  strike  us  in  it.  The  first,  that  France  is  vastly  rich  ;  the 
second,  that  the  trade  of  Europe  has  attained  such  a  magnitude 
that  figures  are  ceasing  to  convey  its  measure  ;  the  third,  that  the 
aggregate  commercial  action  of  nations  is  a  lever  which  can  lift 
any  financial  load  whatever.  As  we  see  the  transaction  now, 


THE   FRENCH   INDEMNITY.  257 

with  these  explanations  of  its  composition  before  us,  we  cannot 
fail  to  recognize  that  it  has  been  rather  European  than  purely 
French.  All  purses  helped  to  provide  funds  for  it ;  all  trades 
supplied  bills  for  it.  In  every  previous  state  of  the  world's  com- 
merce such  an  operation  would  have  been  impossible  ;  fifty,  thirty, 
twenty  years  ago,  it  would  have  ruined  France  and  have  disor- 
dered Europe  ;  in  our  time  it  has  come  and  gone  without  seriously 
disturbing  any  of  the  economic  conditions  under  which  we  live. 
France,  out  of  her  own  stores,  has  quietly  transported  to  Berlin  a 
quantity  of  bullion  larger  than  the  whole  ordinary  stock  of  the 
Bank  of  England  ;  and  yet  she  shows  no  sign  of  having  lost  a 
sovereign.  She  has  paid,  in  her  bank-notes,  for  £170,000,000  of 
transmission  paper,  and  yet  the  quantity  of  her  bank-notes  in  cir- 
culation is  now  steadily  diminishing.  Such  realities  as  these 
would  be  altogether  inconceivable  if  we  did  not  see  their  cause 
behind  them :  that  cause  is  simple,  natural,  indisputable ;  its 
name  is  the  present  situation  of  the  world's  trade.  The  vastness 
of  that  trade  explains  the  mystery. 

But  yet,  with  these  advantages  to  help  it,  the  operation  had,  in 
addition  to  its  enormous  size,  certain  special  difficulties  to  con- 
tend with.  As  one  example  it  may  be  mentioned  that,  amongst 
the  elements  of  perturbation  and  of  consequent  impediments  to 
remittance,  the  French  Government  had  to  keep  in  view  the  fact 
that,  at  the  very  moment  when  it  needed  all  the  monetary  facili- 
ties it  could  obtain,  the  German  Government  was  locking  up  gold 
in  its  cellars,  in  order  to  provide  metal  for  the  new  coinage  it  was 
preparing.  This  was  a  most  unlucky  coincidence  ;  but  it  existed, 
and  it  had  to  be  met.  The  German  plan  was  to  hold  back  the 
issue  of  the  new  money  until  £30,000,000  of  it  were  ready  to  be 
exchanged  for  the  old  silver  currency  ;  consequently,  no  silver 
could  be  expected  to  leave  Germany  until  some  months  after  the 
date  at  which  the  gold  had  been  brought  in  there ;  and,  during 
the  interval,  France  knew  that  she  must  suffer  from  the  with- 
drawal of  so  much  bullion  from  the  general  market.  But  she 
found  assistance  in  an  unexpected  way;  silver  did  flow 
back  to  her  at  once  from  Germany,  without  waiting  for  the  issue 
of  the  new  gold  currency.  France  paid  Germany  £9,572,000  in 
French  silver  ;  but  this  was  of  no  use  to  the  latter  ;  on  the  contrary, 
it  was  an  embarrassment  to  her ;  for  she  was  on  the  point  of  ex- 
porting a  quantity  of  her  own  silver,  which  would  become 
superfluous  as  soon  as  the  new  gold  got  into  circulation.  So,  for 


258  ,        SELECTIONS. 

this  reason,  a  considerable  portion  of  the  French  five-franc  pieces 
came  back  immediately  to  France,  and  helped  to  reconstitute  her 
store. 

And  all  the  other  difficulties  were,  more  or  less,  like  this  one. 
At  first  sight  they  looked  grave  and  durable,  but  they  diminished 
or  disappeared  as  soon  as  they  were  seriously  attacked  ;  the  whole 
thing  turned  out  to  be  an  astonishing  example  of  obstacles  over- 
rated. The  unsuspected  wealth  of  France,  assisted  by  an  extent 
of  general  commercial  dealings  which  was  more  unsuspected 
still,  managed  to  get  the  better  of  all  the  stumbling-blocks  and 
impossibilities  which  seemed  to  bar  the  road.  France  has  lost 
£40x3,000,000,  one-half  of  which  she  has  delivered  to  her  enemy, 
and  yet  she  is  going  on  prospering  materially  as  if  nothing  at  all 
had  happened.  But  it  is  now  quite  clear  that  she  never  could 
have  managed  all  this  alone  ;  she  could  have  found  the  money,  but 
never  could  she,  single-handed,  have  carried  it  to  Germany.  It 
is  there,  far  more  than  in  subscriptions  to  her  loans,  that  the 
world  has  really  helped  her ;  she  has  bought  back  the  stock  that 
foreigners  subscribed  for  her,  but  she  could  not  do  so  without 
the  bills  they  sold  her.  If  she  had  been  left  to  her  own  resources 
for  the  transport  of  the  indemnity  to  Berlin,  she  would  probablv 
have  been  forced  to  send  two-thirds  of  it  in  bullion,  and  to  empty 
her  people's  pockets  for  the  purpose ;  the  vastness  of  the  world's 
trade  and  the  unity  of  interests  which  commerce  has  produced, 
permitted  her  to  use  other  nations'  means  of  action  instead  of  her 
own. 

Viewed  in  this  light,  the  payment  of  the  five  milliards  becomes 
an  enormous  piece  of  admirably  well-arranged  international 
banking,  in  which  nearly  all  the  counting-houses  of  Northern 
Europe  took  a  share.  That  definition  of  it  is  worth  knowing, 
and  we  maybe  glad  that  the  information  given  in  M.  Say's  report 
has  enabled  us  to  arrive  at  it. 


THE    FRENCH    INDEMNITY.  259 

APPLICATION  OF  THE  INDEMNITY. 
FROM  KOLB'S  THE  CONDITION  OF  NATIONS  (TRANS.),  PP.  296-299. 

When  the  North  German  Confederacy  was  formed,  notwith- 
standing the  transfer  of  the  proceeds  of  the  customs  and  of  other 
indirect  imposts  to  the  Confederacy,  and  in  spite  of  considerable 
contributions  by  the  different  States,  the  revenues  did  not  suffice 
to  cover  the  expenditure,  especially  that  of  the  establishment  of  a 
larger  sea  force.  A  deficit  was  the  result,  and  loans  had  to  be 
raised. 

In  the  year  1868  the  debt  of  the  Confederacy  amounted 

to         .         ,         .         .          .         .         •-.....»"•  £540,000 

In  1869  to.          .  .         .         .         .         .         .  1,312,338 

And  in  1870  it  rose  to         .         ...         .         .  1)735^743 

While  in  1871  it  was          .         .         ..       .         .         .  1,988,882 

The  war  made  the  contraction  of  a  further  debt  unavoidable, 
both  for  the  States  of  the  North  German  Confederacy  as  well  as 
for  those  of  South  Germany.  The  sum  immediately  expended 
on  the  war  must  have  amounted  to  about  £51,000,000.  The 
result  of  the  war  led  to  a  complete  revolution  in  the  condition  of 
finance.  We  extract  the  following  data  from  the  memorandum, 
which  was  laid  before  the  Diet  by  the  Imperial  Chancellor  on 
February  18,  1874,  with  regard  to  the  application  of  the  French 
war  contribution  :  — 

The  Receipts  amounted  to  — 

1.  War  contribution  by  France    ....      £200,000,000 

2.  Interest  upon  this  till  the  payment  of  the  debt,  12,047,678 

Total         .         .         ...         .          .     £212,047,678 

3.  Added    to   this,  contribution    of    the    City  of 

Paris 8,025,879 

4.  Customs  levied  in  France  and  local  contribu- 

tions, less  cost  of  collection,  so  far  as  these 
sums  were  not  employed  for  special  military 
purposes,  about  ......  2,609,133 

Total  receipts    .         .         .         .         .         .     £222,682,690 


260  SELECTIONS. 

Of  this  sum,  .£12,999,999  must  be  deducted  for  the  acquisition 
of  railways  belonging  to  a  private  company  in  Alsace-Lorraine, 
the  remainder  being,  therefore,  £209,682,691. 

Expenditures. 

ist.  Expenses  for  which  fixed  sums  were  granted  by  Imperial 
decrees,  viz. : — 

For  the  Imperial  Invalid  Fund  .  .  .  .  £28,050,000 
For  the  completion  of  German  fortresses  .  .  10,800,000 
For  fortresses  in  Alsace-Lorraine  ....  6,037,642 
For  railroads  in  the  Imperial  Dominions,  particularly 

the  Wilhelm-Luxembourg  line         .         .         .        8,210,883 
For  Imperial  war  treasures,  to  be  kept  in  the  Julius 

tower  of  the  fortress  of  Spandau      .         .         .        6,000,000 
Compensation  for  the  decrease  in  the  revenue  caused 
by  alterations  in  the  management  of  the  customs 

and  taxes 2,968,907 

Imperial   Treasuiy  fund,  for  the  administration  of 
the  marine,  and  for  unredeemable  advances  for 
the  management  of  the  Imperial  army      .         .         1,503,000 
For  gratuities  to  generals  for  distinguished  services,  600,000 
For  aid  to  Germans  banished  from  France       .         .  300,000 
For  exercise  ground  for  the  Artillery-trial  Commis- 
sion           206,250 

Expenditure  for  general  purposes  defrayed  by  the 
Imperial  Treasury  in  1870  and  1871?  and  the  ad- 
ditional outlay  for  troops  garrisoned  in  Alsace- 
Lorraine  till  the  end  of  1872  ....  1,249,500 

Lastly,  £6,195,181  granted  by  an  Imperial  decree  of  July  8, 
1873.  For  marine,  £4,206, 783.  Buildings  for  the  Diet,  £1,200,- 

000.  Supplemental    expenses  of  war,  including  various   other 
grants,  making  total  of  £72,116,704. 

To  this  must  be  added  those  outlays,  the  amount  of  which  de- 
pends on  the  sum  required  for  the  attainment  of  the  object  in 
view.  They  may  be  estimated  as  follows  :  — 

1.  Compensation  for  damages  by  war  and  for  war  .     £5,655,000 
<  2.  Compensation  to  German  ship-owners        .         .  840,000 


THE   FRENCH    INDEMNITY.  2(6 1 

3.  For  war  medals          ......  £45,000 

4.  Invalid  pensions  in  consequence  of  the  war  of 

1870,  1871,  and  1872 1,513,466 

5.  Additional  for  payment  of  invalid  pensions,  pay- 

able out  of  the  Imperial  Invalid  Fund  during 
the  time  that  that  fund  was  not  perfectly  estab- 
lished   897,000 

6.  War  expenses  connected  with  the  French  War  costs  indemni- 

fication, which,  according  to  Art.  5  of  the  decree  of  July  8, 
1872,  are  to  be  treated  as  common  charges,  viz.  :  — 

(a)  For  arming  and  disarming  of  fortresses  .  £1,477,078 

(3)  For  siege  material        ..         .         •         •  •  I>4°9?223 

(c)  For  marine  administration    ,        ..    .    ..  ..  1,402,876 

(d)  For   temporary  arrangements    for  coast  de- 

fence, etc.  '.   ?         148,121 

(e)  For  laying  down  and  repairing  railroads,  etc., 

necessary  for  prosecuting  the  war      .         .  718,797 

(f)  For  the  establishment  and  working  of  tele- 

graphs outside  the  limit  of  the  telegraph 

system      .......  3<Mr8 

(g)  For  temporary  civil  administration  in  France, 

especially  for  management  of  railways  in 
Alsace-Lorraine,  till  the  end  of  1871          .  563/^57 

Further  for  services  which  from  July  i,  1871,  were  in  connection 
with  the  war,  viz. :  — 

(k)  Management  of  the  post       .         .  .  ^33->75° 

(i)    Management  of  telegraphs  ....  88,500 

(k)   Increased  expenditure  in  the  management  of 
the  army,  over  and  above  that  in  time  of 
peace,  consequent  upon  the  occupation  of 
French  territory         .....         3,150,000 
(/)  Further  estimates  for  general  expenses  to  be 

defrayed  by  the  Imperial  Treasury,  about,  37?5<x> 

The  total  amount  of  expenditure  fund  to  be  deducted  from  the 
revenue  amounts  therefore  to  £90,125,544,  leaving  a  remainder 
of  £119,057,197  to  be  divided.  It  is,  however,  desirable  to  retain 


262  SELECTIONS. 

a  moderate  reserve  for  possible  deficiencies  in  the  estimated  re- 
ceipts, in  expectation  of  greater  requirements  in  the  expenditure. 
The  sum  to  be  divided  may,  therefore,  be  estimated  in  round 
numbers  at  £1 18,900,000.  Three-fourths  of  this  were,  in  accord- 
ance with  Article  6  of  the  Statute  of  the  8th  of  July,  1873,  set 
apart  for  military  purposes,  in  the  proportion  specified  in  the 
above  Article  6,  and  one-fourth  to  be  divided  according  to  a  fixed 
standard  of  1871-  The  sum  for  division  is  shared  as  follows  :  — 

1.  Bavaria      .         .         .         .         ."  ;'  ;  :'    .         .  £13,380,061 

2.  Wurtemburg      .         .         ;         .         .         .         .  4,275,130 

3.  North  German  Confederation     .         .'        .         .  79i5I7'4°7 

4.  Baden 5,019,977 

4.  Hesse 1,400,051 

For  the  payment  of  expenses -I     ,  9*7>  5° 

1  16,289,521 

About  £22,500,000  of  the  entire  war  contribution  were,  in 
obedience  to  Imperial  decrees,  applied  to  civil  objects,  the  rest  for 
purposes  of  war.  The  sums  which  fell  to  the  separate  States  in 
the  division  were  also  mostly  expended  in  defraying  the  costs 
of  war,  and  the  repayment  of  loans  for  war. 

According  to  the  Statute  of  2d  of  July,  1873,  £16,027,021  of 
the  sum  to  be  divided  were  set  apart  for  restoring  the  army  to  a 
war-footing  and  increasing  its  general  efficiency. 

We  find  from  a  report  of  the  Commission  on  the  State  Debt, 
under  date  April,  1874,  that  the  Imperial  Invalid  Fund  possessed 
paper  of  nominal  value  in  thalers  ....  £23,081,742 
In  South  German  guldens  .  .  .  ,  ,.  .  933tz$7 

In  Dutch  guldens  .  .  .  (  ,.  .  .  .  2I3<333 

In  English  £  sterling  .  .  .  .  .  .  918,760 

In  dollars 3,556,800 

And  in  banks  .......  393 

The  fortress  building  fund  possessed  at  the  same  time  a  nominal 
value  of  £5,229,795  in  effects,  and  a  capital  of  £2,789,913  in  the 
Prussian  bank.  .  .  . 


THE   RECENT   PROGRESS    OF   ITALY.  263 


XIII. 
THE    RECENT    PROGRESS    OF    ITALY. 

FROM  WILSON'S  THE  RESOURCES  OF  MODERN  COUNTRIES, 
VOL.  II.,  CHAP.  IX. 


THE  rapidity  with  which  the  new  Italian  kingdom  has  grown 
out  of  a  congeries  of  petty  States  and  subject  Provinces  is  a  good 
augury  for  its  future.  Unless  we  must  yet  look  forward  to  a 
time  of  social  revolutions,  —  to  struggles  between  priestcraft  and 
popular  liberties, — of  which  there  are  at  present  few  seriously 
disturbing  signs,  there  is  little  to  hinder  modern  Italy  from  ad- 
vancing to  the  position  of  one  of  the  most  thriving  nations  of  the 
Old  World. 

There  is,  indeed,  something  very  attractive  in  the  progress 
which  Italy  is  making.  It  is  a  progress  dashed  with  errors,  and 
not  without  dangers,  of  course  ;  but  it  has  for  all  that  been  great 
and  admirable.  We  have  but  to  glance  for  a  moment  at  the 
picture  which  the  dismembered  kingdom  presented  before  she 
began  to  stir  for  her  freedom  in  1848.  The  first  stirrings  were  in- 
deed earlier  than  that ;  for  Italy,  bound  hand  and  foot  at  the  feet 
of  Austria,  as  she  was  by  the  Congress  of  Vienna,  which  restored 
and  solaced  exiled  and  effete  dynasties  in  all  Western  and  Cen- 
tral Europe,  —  Italy  never  quite  forgot  the  liberal  ideas  which  the 
republican  armies  of  the  young  citizen  Bonaparte  had  carried 
with  them  out  of  France.  The  dull  brutal  rule  of  Austria  in 
Venetia  and  Lombardy,  and  the  more  than  Asiatic  ruthlessness 
of  the  Bourbons  of  Naples,  gave  the  Italians  small  chance  to  for- 
get their  dreams  of  a  bright  deliverance.  Accordingly,  there  had 
been  risings  before  1848  ;  and,  besides  the  risings,  many  an  effort 
to  persuade  the  people  to  stand  up  like  men  for  their  rights,  that 
had  seemingly  led  to  nothing.  But  it  was  not  till  1848  that  Italy 
could  be  said  seriously  to  bend  herself  to  the  task  of  wrenching 
her  shackles  off.  That  year  sent  a  quiver  of  dread  through  the 
heart  of  ever}' king  and  kinglet  in  Europe.  Again  the  impulse 
came  from  France,  that  country  so  full  of  striking  ideals  in  its 


264  SELECTIONS. 

modern  political  history,  —  ideals  which  have  been  made  the 
pretext  of  tremendous  crimes  ;  but  dismembered  Italy  could  have 
made  no  headway  at  all  against  either  Bourbon  or  Hapsburg, 
except  for  the  resolution  of  Charles  Albert,  the  King  of  Sardinia, 
to  become  the  champion  of  national  unity  and  independence. 
The  new  generation  of  to-day  forgets  these  things ;  but  middle- 
aged  men  remember  the  excitement,  the  hopes,  at  first  even 
stimulated  by  the  sovereign  Pontiff,  destined  to  so  cruel  a 
disappointment.  Italy  was  beaten  back  apparently  into  slavery, 
in  this  her  first  grand  dash  for  freedom,  and  the  dreams  of 
Mazzini  and  Cavour  seemed  to  be  gone  as  dreams  all  go.  The 
weak-kneed  Pope  had  turned  traitor  to  the  nation,  in  his  greed  of 
temporal  ascendency,  and  had  given  it  his  curse.  Powers  too 
strong  for  them  were  arrayed  against  the  people,  the  Sardinian 
armies  were  defeated,  and  Italy  seemed  by  1850  to  have  lost 
everything.  It  was  not,  however,  so  to  be.  The  defeat  gave  a 
keenness  to  the  national  feeling  all  over  the  land,  such  as  it  had 
not  attained  to  before.  Neapolitan  and  Lombard  began  to  recog- 
nize themselves  as  men  of  the  same  nationality.  The  repression 
of  the  foreigners  had  thus  to  do  its  final  work  in  welding  the 
nation,  and  the  conquerors  endeavored  to  do  it  effectually,  to  their 
own  ultimate  overthrow. 

Louis  Napoleon  also  did  something,  no  doubt,  for  the  libera- 
tion of  Italy,  in  a  grandiose,  histrionic,  morally  contemptible 
way,  urged  as  he  was  by  the  necessity  of  justifying  his  rather 
despicable  existence  in  the  eyes  of  France  ;  but,  whether  he  had 
interfered  or  not,  the  power  of  Austria  was  destined  to  fall  before 
the  rising  forces  of  Prussia,  and  with  it  that  of  the  Bourbons  of 
Sicily,  Naples,  and  Tuscany,  most  corrupt  of  all  the  corrupt 
creatures  whom  England  had  propped  up  again  for  a  brief  space, 
to  play  the  part  of  tyrants  and  oppressors  in  mundane  affairs.  It 
is  not  my  purpose  to  follow  the  history  of  the  Italian  struggle  for 
independence,  through  its  Napoleonic  and  other  phases  ;  suffice 
it  that  we  call  to  mind  some  of  the  cardinal  facts.  Before  1848 
Italy,  all  except  Piedmont,  seemed  hopelessly  crushed.  Austria, 
the  Pope,  and  the  Bourbons  held  her  in  their  grasp.  Even  the  com- 
paratively native  sovereign  of  Tuscany  had  turned  oppressor,  and 
all  Italy  groaned  like  a  man  in  the  grasp  of  the  torturer.  Com- 
merce languished,  divergent  fiscal  laws  and  arbitrary  raids  on 
private  wealth  choked  up  the  channels  of  intercourse  between 
one  part  of  the  kingdom  and  another ;  without  shipping,  without 


THE    RECENT   PROGRESS    OF   ITALY.  265 

manufacturers  or  foreign  trade  of  a  solid  kind,  possessed  of  no 
political  security,  Italy  was,  thirty  years  ago,  more  insignificant 
in  the  eyes  of  neighboring  nations  than  Greece  or  Spain  is  now. 
But,  once  free,  her  consolidation  was  almost  as  rapid  as  that  ot 
the  still  newer  German  Empire  ;  and  to-dav  Italy  is  a  power  to  be 
reckoned  with  in  the  councils  of  nations,  and  possesses  a  trade  that 
begins  to  be  a  distinct  element  in  European  prosperity,  —  a  trade 
that  we  in  England  cannot  too  carefully  give  heed  to.  The  bitter 
bondage  which  the  country  has  long  lain  under  has  ended  in 
making  its  mixed  population,  in  a  hopeful  degree,  a  nation  ;  and, 
prudently  ruled,  new  Italy  may  yet  have  a  remarkable  career 
before  it. 

Naturally  enough,  all  this  progress  has  not  been  made  without 
great  cost,  and  it  is  our  duty  to  look  at  both  sides  of  the  picture  ; 
nor  should  the  political  and  commercial  success  blind  us  to  the 
fact  that  the  young  kingdom  is  not  free  from  serious  economic 
and  social  danger's  on  more  sides  than  one.  The  very  transition 
from  a  collection  of  petty  States  to  a  single  power  entailed  enor- 
mous waste  of  resources  and  almost  irremediable  administrative 
confusion.  Jealousies  were  also  engendered  between  province 
and  province,  which  it  will  take  some  time  to  heal ;  so  that  this 
transition  stage  cannot  by  any  means  be  considered  at  an  end  in 
Italy.  Nor  need  we  wonder  when  we  remember  that  it  is  barely 
seven  years  ago  since  the  crowning  act  of  Italian  unity  was  per- 
formed, and  Victor  Emmanuel  entered  Rome  as  King  of  all  Italy, 
to  the  disgust  of  Pio  Nono  and  the  corrupt  creatures  around 
him. 

I  must  leave  the  historical  part  of  the  subject,  however,  and 
trace  some  of  the  financial  characteristics  of  this  period  of  tran- 
sition, before  examining  the  trading  capacity  and  mercantile 
development  which  Italy  exhibits.  These  financial  characteristics 
are  again  so  intimately  bound  up  with  the  administrative  machin- 
ery of  the  State,  that  in  noticing  the  one  we  must  notice  the 
other.  Indeed,  the  first  things  that  strike  the  observer  are  the 
concurrent  facts  that  the  government  of  Italy  has,  throughout, 
been  impecunious,  and,  throughout,  comparative  feeble  and  irres- 
olute, while  yet  the  nation  has  grown  and  consolidated.  No 
statesman  has  succeeded  to  the  seat  of  Count  Cavour ;  and,  either 
because  the  men  were  feebler,  or  because  the  constitutional 
powers,  donned  suddenly  like  a  garment,  fitted  but  ill,  the  reme- 
dial measures  which  society  and  the  State  required  on  all  hands 


266  SELECTIONS. 

have  been  but  tentatively  and  tardily  applied,  amid  not  a  little  bung- 
ling. The  new  kingdom  succeeded  to  all  the  debts  of  the  petty 
States  it  absorbed,  and  it  also  succeeded  to  their  corrupt  adminis- 
trations. The  debts  made  a  most  serious  burden  to  begin  with  ; 
and,  when  added  to  the  cost  of  the  wars  of  independence,  so  handi- 
capped Italy  that  few  people  would  have  been  surprised  if  she 
had  pulled  up  short  and  proclaimed  herself  bankrupt.  In  a  most 
valuable  report  on  the  financial  system  of  the  kingdom,  recently 
made  to  our  foreign  office  by  Mr.  Herries,  Legation  Secretary  at 
Rome,1  we  are  enabled  to  trace  very  clearly  the  stages  of  this 
financial  malady ;  and  many  of  the  statements  I  shall  make  here 
will  be  drawn  from  this  source.  Quoting  Mr.  Pasini,for  instance, 
he  gives  the  total  debt  of  the  petty  States  of  Italy,  just  before 
the  consolidation  of  the  kingdom  in  1871,  at  ,£90,000,000,  or 
2,241,270,000  lira.2  The  debt  was  growing  rapidly  then,  as  the 
expenditure  in  all  cases  exceeded  the  income  ;  but,  after  the  new 
kingdom  was  fairly  started,  the  deficits  grew  worse  and  worse. 
In  the  words  of  Mr.  Pasini  it  is  stated  that  during  this  disastrous 
period  the  receipts  were  diminished  by  £1,280,000,  while  the 
expenditure  was  increased  by  £2,280,000  and  the  public  debt  by 
£30,360,000.  Only  in  the  old  provinces  forming  the  kingdom  of 
Sardinia  was  there  any  elasticity  of  revenue ;  in  all  other  prov- 
inces the  ousting  of  the  old  government  and  the  setting  up  of  the 
new  involved  almost  hopeless  fiscal  confusion  and  loss.  Income 
fell  ofF  and  expenditure  increased  until  the  budget  deficits,  which 
had  nominally  been  but  £520,000  in  1859  f°r  tne  vari°us  States 
composing  Italy,  rose  to  over  £4,000,000,  the  greater  part  of 
which  was  due  to  the  Neapolitan  provinces  and  Sicily.  Taxes 
of  an  odious  character  imposed  by  the  old  tyrannical  gov- 
ernments had  to  be  taken  off  and  reduced  before  any  regular 
system  of  substitutes  could  be  framed  to  take  their  place ;  so  that, 
as  pointed  out  in  the  report  of  a  finance  committee,  also  quoted 
by  Mr.  Herries,  and  which  gives,  it  would  seem,  a  different 
estimate  from  that  of  Pasini,  the  income  of  the  States  forming 
United  Italy  fell  from  over  £200,000,000,  at  the  time  of  the  break- 
ing out  of  the  war,  to  £18,500,000,  the  following  year,  and  the 

1  Embassy  and  Legation  Reports,  part  iv.,  1876. 

'Martin,  in  his  Statesman's  Year-book,  states  the  debt  of  Italy  in  1860,  the  year  before 
the  emancipation,  at  £97,500,000,  but  does  not  give  his  authority.  It  is  possible  he  may  be 
right,  however,  because  the  debts  being  reckoned  in  different  currencies,  some  of  which 
were  of  fluctuating  values,  the  best  statement  which  could  be  given  was  partly  only  an 


THE  RECENT  PROGRESS  OF  ITALY.         267 

expenditure  exceeded  that  diminished  income  by  £7,200,000. 
This  deficit,  however,  as  others  similar,  refers  mostly,  if  not  ex- 
clusively, to  the  ordinary  income  and  expenditure,  and  does 
not  include  the  special  outlay  incident  to  the  war,  which  is  par- 
tially at  least  represented  by  the  increase  of  the  public  debt.  In 
1860  and  1861,  no  less  than  some  £370,000,000  nominal  appears 
to  have  been  raised  by  loans,  issues  of  inconvertible  paper,  or 
sales  of  stocks,  only  part  of  which  have  since  been  redeemed.1 
There  were  six  separate  budgets  for  the  various  parts  of  Italy  in 
1860,  and  it  was  not  till  1862  that  the  government  was  able  to 
present  a  single  budget  for  the  united  nation  ;  but  that  was  only 
the  initial  stage  of  the  task  which  Italian  financiers  had  before 
them.  A  cumbersome  method  of  account-keeping  had  to  be 
swept  away,  which  under  the  old  system  entailed  the  mischief  of 
several  distinct  statements  of  accounts  running  alongside  each 
other.  The  budget  passed  through  no  less  than  seven  different 
stages  before  it  could  be  considered  a  finished  account,  and  it 
was  not  till  1869  that  this  was  swept  away.  Now  the  financial 
account  runs  even  with  each  year,  and  comprises  within  it  only 
the  actual  receipts  and  payments  of  the  year.  Further  reforms  as  to 
the  administration  of  the  various  departments  of  the  State  had  still 
to  be  carried  out,  and  it  was  only  the  other  year  that  Italy  could  be 
said  to  have  her  finances  completely  under  parliamentary  control. 
A  far  more  formidable  difficulty  remains  to  be  noticed,  — the  ref- 

1 1  find  great  divergencies  in  the  estimates  given  in  various  works  of  the  present  debt  of 
Italy.  For  example,  Kolb,  whom  I  am  disposed  to  place  first  as  a  compiler  of  statistics  of 
this  kind,  gives  the  debt,  funded  and  floating,  at  the  end  of  1873,  as  10,060,000,000  lira,  the 
interest  of  which  is  460,445,614  lira.  In  other  words,  the  capital  of  the  debt  was  £400,000,- 
ooo  odd,  and  the  interest-charge  just  under  £18,500,000.  Martin,  on  the  other  hand,  in  the 
new  issue  of  his  Statesman's  Year-book,  places  the  capital  of  the  debt  at  about  £380,000,- 
ooo,  at  the  end  of  1873,  including  of  course  the  paper  money,  and  the  interest-charge  at  just 
over  £15,500,000.  Again,  the  Investor's  Monthly  Manual,  a  publication  usually  accurate, 
and  with  figures  to  a  more  recent  date  than  either  Martin  or  Kolb,  places  the  capital  of  the 
debt  at  only  £357,000,000,  and  the  interest  and  other  charges  thereon  at  £15,300,000.  This 
last  estimate  appears  to  me  to  be  an  obvious  error,  because  for  one  thing  the  deficits  on  the 
annual  budget  have  not  yet  ceased,  and  these  alone  for  the  past  four  years  have  amounted 
to  an  aggregate  of  £28,000,000,  which  has  necessarily  added  to  the  debt  in  some  form. 
If  we  take  Kolb  to  be  correct,  therefore,  the  debt  at  the  end  of  last  year  cannot  have  been 
less  than  £430,000,000  all  told.  This  is,  it  need  hardly  be  said,  a  very  serious  burden  For  so 
young  a  nation  to  carry,  and  it  has  been  further  heavily  augmented  since  by  the  Italian 
government  taking  over  the  Italian  portion  of  the  old  Lombardo-Venetian  Railways,  as  it 
contracted  with  the  Rothschilds  last  year  to  do.  This  bargain  will  involve  an  addition  to 
the  debt  of  at  least  £30,000,000,  including  the  extra  payments,  and  should  the  yearly  deficits 
go  on,  and  the  railways  not  pay,— both  likely  contingencies,—  the  taxation  of  Italy  will 
have  to  be  seriously  increased.  By  1880  we  may  expect  to  see  the  funded  and  floating  debt 
raised  to  the  amount  of  £470,000,000  to  £500,000,000,  and  the  chances  of  a  redemption  of 
the  paper  currency  almost  as  remote  as  ever. 


268  SELECTIONS. 

ormation  of  the  taxes,  —  and  that  cannot  yet  be  said  to  be  any- 
thing like  completed,  for  Italy  is  still  too  poor  to  have  a  consistent 
fiscal  system.  There  was  a  too  radical  cutting  down  of  obnox- 
ious.imposts  in  the  first  moment  of  liberty  and  unity,  when  men's 
hearts  overflowed,  and  ever  since  the  government  has  had  to  strug- 
gle painfully  to  make  ends  meet.  One  of  the  best  sources  of 
national  income,  the  property  and  the  land  tax,  has  also  been 
most  difficult  of  administration,  through  the  absence  of  any- 
thing like  a  sound  basis  of  assessment,  and  it  now  only 
yields  something  like  £9,300,000,  including  provincial  and  com- 
munal surtaxes.  In  1874  this  was  levied  upon  5,130,146  proprie- 
tors, and  the  average  impost  per  proprietor  for  imperial  purposes 
only,  was  almost  exactly  £i.  The  amount  of  this  tax  which 
actually  goes  to  the  State  is  thus  only  about  £5,000,000,  the  rest 
being  devoted  to  local  purposes  under  the  law  which  permits 
provinces  and  communes  to  levy  certain  imposts  for  themselves. 
The  figures  as  regards  the  number  of  people  assessed  cannot, 
however,  be  depended  upon,  any  more  than  the  cadastral  basis  of 
the  tax ;  and  there  is  no  reform  more  urgently  needed  than  the 
one  which  shall  distribute  the  burden  fairly  over  the  landowners 
and  metayers.  At  present  the  tax  falls  too  lightly  on  some  parts 
of  the  country,  and  on  the  tenant  classes,  and  far  too  heavily  on 
others,  and  altogether  does  not  yield  probably  within  millions  of 
what  it  ought  to  do.  Another  considerable  source  of  revenue  is 
the  income  tax,  which  is  not  however  to  be  taken  as  similar  in 
character  to  the  English  tax  of  that  name,  being  a  complex  and 
irritating  impost  which  includes  licenses  of  various  kinds,  and 
which  presses  very  heavily  on  small  incomes.1  It  seems  to  vary 
in  character,  too,  in  different  parts  of  this  kingdom.  The  grist-tax 
should  also  be  mentioned  as  an  old  and  most  oppressive  impost  on 
the  grinding  of  corn,  which  was  withdrawn  at  the  Revolution, 
and  reimposed  afterwards  under  pressure  of  the  necessities  of 


1  Mr.  Herries  makes  the  following  comparison  between  the  burden  of  this  tax  on  the 
Italians  and  of  the  English  income  tax.  His  figures  were  compiled  before  the  date  of  Sir 
StaffoYd  Northcote's  budget  last  year,  which  relieved  small  incomes  up  to  £300,  while  im- 
posing an  additional  penny  on  all  beyond  that;  but  they  are  sufficiently  close  to  the  facts, 
and  illustrate  the  peculiar  irritation  of  the  Italian  tax.  "An  Englishman  having  an  income 
of  exactly  £100  pays  nothing.  An  Italian  pays  on  its  equivalent,  if  in  Category  A,  £13 
45.;  if  in  Category  B,  £9  i8s.;  if  in  Category  C,  £8  55.  A  so-called  '  professional  man' 
in  London,  with  an  income  of  just  £300,  pays  on  that  amount,  minus  £80,  a  tax  of  £i  i6s. 
8d.  If  he  establishes  himself  at  Rome,  he  will  soon  find  his  means  of  subsistence  dimin- 
ished by  a  charge  of  £24  153. ;  the  sum  which  in  England  would  be  due  from  a  commercial 
house  making  a  clear  profit  of  £2,970  a  year." 


THE  RECENT  PROGRESS  OF  ITALY.         269 

the  State.  In  its  new  form  it  is  vexatious,  and  that  it  should  be 
required  at  all  is  a  proof  both  of  the  poverty  which  Italy  still 
labors  under  and  of  the  imperfect  manner  in  which  the  fiscal  re- 
forms have  yet  been  carried  out.  It  gives  a  gross  return  of  about 
£3,500,000. 

We  might  pursue  this  subject  further,  and  find  it  very  interest- 
ing ;  but  my  object  is  only  to  indicate  the  broad  fact  that  Italy  is 
reforming  ;  is,  though  slowly,  growing  solidly  together  ;  that  she 
has,  to  all  appearance,  heartily  adopted  constitutional  forms,  and 
is  shaping  her  destiny  to  good  purpose,  in  spite  of  the  many 
drawbacks  to  which  she  is  subject.  By  means  of  the  changes  which 
have  been  introduced,  the  peace  and  security  that  have  prevailed, 
and  the  consequent  increase  in  wealth,  the  gross  income  of  the 
kingdom  has  slowly  recovered  itself,  until  in  1875  it  amounted 
to  £55,480,000.  In  1876  it  was  rather  less,  being  only  £54,800,- 
obo,  owing  to  the  insufficient  harvest,  rather  than  to  any  weakness 
in  the  country.  In  1877  the  fiscal  estimate  of  ordinary  income 
was  about  £51,000,000,  but  the  total  receipts,  ordinary  and  ex- 
traordinary, were  placed  at  about  £56,000,000.  There  are  still 
deficits,  of  course,  but  they  are  growing  on  the  whole  less  alarm- 
ing;  that  for  1875  having  been  only  £1,124,000,  that  for  last  year 
£1,160,000,  and  the  estimate  for  the  present  year  showing  a  sur- 
plus, which  will,  however,  in  all  possibility  prove  delusive. 
There  is,  perhaps,  some  reason  to  hope  that  deficits  may  really 
disappear  before  long,  unless  unforeseen  events  check  the 
gradual  development  of  the  community,  or  unless  the  imprudent 
commitments  of  the  government  to  railway  purchases  and  ad- 
ministration lead  to  unexpected  loss.  I  should  not  be  surprised, 
however,  were  this  to  prove  the  case ;  and,  if  so,  the  small 
deficits  of  the  last  year  or  two  may  again  increase  for  a  time,  but 
only  for  a  time.  Italy  has  but  to  push  forward  her  social  reforma- 
tion, to  steadily  reorganize  her  finances  and  her  provincial  ad- 
ministrations, and  there  can  be  no  fear  that  the  wealth  of  the  country 
will  not  be  found  in  time  sufficient  to  furnish  all  the  government 
requires.  The  only  serious  elements  of  financial  danger  are  the 
funded  and  floating  debt,  and  the  wasteful  expenditure  of  the 
municipal  and  district  governments  ;  some  of  the  Italian  cities, 
such  as  Florence,  Naples,  and  Genoa,  being,  for  example,  almost 
as  spendthrift  as  New  York.  These,  therefore,  constitute  grave 
dangers,  which  Italian  statesmen  cannot  too  deeply  recognize. 
Not  only  should  every  effort  be  made  to  keep  down  the  national 


2/0  SELECTIONS. 

and  local  expenditure,  so  that  there  should  be  no  further  increase 
in  its  amount,  but  every  effort  should  be  made  to  reduce  the  debt 
also.  This  is  especially  necessary  with  regard  to  the  paper  cur- 
rency, which  now  forms  such  an  intolerable  drag  upon  the  com- 
merce of  the  people.  In  amount  it  seems  light  beside  that  of 
France,  being  only  some  £40,000,000 ;  but  then  the  population 
of  Italy  and  the  trade  of  Italy  are  both  much  less.  The  imports 
and  exports  together  are  under  £100,000,000,  or  less  than  a  third 
of  those  of  France.  Moreover,  Italy  has  little  or  no  metallic 
reserve,  so  that  her  paper  currency  is  of  necessity  bound  to*  fluct- 
uate with  every  adverse  movement  of  the  exchanges.  As  the 
imports  of  the  country  have  been  stimulated  for  many  years  by 
the  issue  of  such  paper,  and  by  other  loans,  so  that  they  uniformly 
exceed  the  exports,  it  follows,  of  course,  that  exchanges  are  often 
adversely  affected.  Add  to  this  th.e  fact  that  a  good  deal  of 
Italian  rente  is  held  abroad,  in  France,  Holland,  and  England, 
and  we  have  abundant  materials  for  a  very  troublesome  state  of 
mercantile  credit.  The  premium  on  gold  is  rarely  less  than  10 
per  cent.,  and  it  rises  sometimes  to  12  and  15,  or  even  to  20. 
During  one  year  the  fluctuation  is  not  unfrequentlv  as  much 
as  from  5  to  7  Per  cent.,  so  that  the  difficulty  of  adjusting 
prices,  so  as  to  avoid  ruinous  losses,  becomes  most  serious.  A 
premium  on  gold  becomes,  as  I  have  said  before,  a  universal  tax, 
because  no  commodity,  sold  or  bought,  can  be  made  exempt  from 
its  influences.  Of  late,  however,  there  has  been  less  tendency  to 
violent  movement  in  this  gold  premium,  and  the  average  is  lower 
now  than  it  was  in  the  years  immediately  succeeding  the  national 
independence.  Should  the  funded  debt  be  kept  well  within 
bounds,  therefore,  it  might  be  worth  the  consideration  of  Italian 
statesmen  whether  the  government  should  not  make  an  approach 
towards  a  resumption  of  specie  payments,  by  means  of  an  issue 
of  bonds  for  the  purpose  of  redeeming  the  currency  debt.  A 
measure  of  the  kind,  were  it  accompanied  by  the  exemption  of 
the  foreign  creditors  of  the  State  from  an  income  tax,  which  is  not 
fairly  justifiable  when  imposed  on  loans  which  were  raised 
abroad,  would  do  a  great  deal  to  elevate  the  commerce  of  Italy 
out  of  its  fifth-rate  position,  and  to  make  it  solidly  prosperous. 

There  are,  as  we  see,  drawbacks  in  the  situation  of  the  country  ; 
but  for  all  that  I  shall  rriiss  my  aim  grievously,  if,  in  this  rapid 
sketch,  giving  the  outlines  of  both  sides  of  the  subject,  I  do  not 
show  that  Italy  has  made,  and  is  making,  steady  progress.  She 


THE  RECENT  PROGRESS  OF  ITALY.         2/1 

is  not  standing' still,  nor  going  back  in  either  her  political  organi- 
zation or  her  finances.  The  nation  has  vitality  as  a  nation,  and 
through  all  the  drawbacks  and  difficulties  one  can  discern  the 
possibility  of  a  new  future  for  the  peninsula  which  once  ruled  the 
world.  Splendidly  situated  for  doing  at  all  events  a  continental 
trade  with  Asia  and  the  far  East,  it  is  possible  that  the  tide  of 
commerce  will  partially  roll  backwards  to  her  long-deserted 
shores.  We  must  try,  then,  to  find  out  what  Italy  is  doing  in  the 
way  of  developing  her  trade  —  what  her  capacities  are,  and  what 
hindrances  there  may  be  in  her  way  other  than  the  merely  finan- 
cial or  administrative. 

In  the  first  place,  it  may  be  at  once  admitted  that  Italy  is  not 
a  manufacturing  country  now,  nor  very  likely  speedily  to  become 
one.  The  races  which  inhabit  southern  Italy  are  ill  adapted  for 
the  hard  incessant  labor  to  which  "  factory  hands  "  and  "  foundry 
hands  "  have  to  submit  in  any  country,  but  most  of  all  in  a  coun- 
try striving  to  establish  a  business  for  itself  at  the  expense  of 
rivals.  In  northern  Italy  there  is  much  more  raw  capacity  for 
industry  ;  and  the  hardy  Lombards  or  Piedmontese  —  even  the 
Venetians  and  Tuscans  —  might,  if  it  depended  upon  mere  labor 
alone,  rise  with  some  rapidity  into  the  position  of  competitors 
with  other  nations  for  certain  kinds  of  manufactured  staples. 
But,  granting  everything  to  be  favorable  in  the  character  of  the 
people,  Italy  does  not  possess  the  raw  materials  necessary  to  a 
great  manufacturing  nation  in  sufficient  quantities,  or  in  a  form 
so  readily  accessible  as  to  make  it  possible  for  her  to  become  great 
in  this  way.  The  only  industry  in  which  she  can  be  said  to 
possess  some  advantage  over  her  neighbors  is  silk-weaving,  and 
in  this,  I  believe,  some  progress  was  made  up  to  the  time  when 
a  change  of  fashion,  and  failure  in  the  Italian  silk  crop,  gave  the 
entire  industry  a  severe  blow  ;  but  as  a  producer  of  textile  fabrics 
generally,  Italy  does  not  promise  to  take  a  strong  position.  Her 
exports  of  silk,  raw  and  manufactured,  averaged  in  value  about 
£15,000,000  in  the  years  1870  to  1874,  according  to  tables  given 
by  Mr.  Herries.  This  was  balanced  to  some  extent  by  imports 
of  the  average  value  of  £5,500,000.  Besides  silk,  Italy  grows  a 
certain  amount  of  cotton,  but  not  nearly  enough  to  supply  her 
own  wants ;  and  although  she  has  an  export  trade  to  Austria  in 
cotton  tissue,  it  is  more  of  a  transit  trade,  I  believe,  than  the 
result  of  the  competition  of  Italian  spinners  and  weavers.  Her  in- 
dustries are,  indeed,  all,  except  that  of  silk,  small  and  of  quite 


272  SELECTIONS. 

local  importance.  Italy  is  in  nothing  more  provincial,  in  fact, 
than  in  the  isolated  condition  of  her  cotton,  linen,  and  woollen 
manufactures.  But,  although  insignificant,  they  still  increase  in 
a  measure,  and  may  well  grow  very  much  bigger  without  inter- 
fering in  the  least  with  the  purchasing  power  of  Italy  in  other 
countries,  or  competing  very  seriously  in  foreign  markets.  With 
her  immediate  neighbors,  Switzerland,  Austria,  and  France,  it 
is  in  the  nature  of  things  that  her  trade  should  grow  larger,  and 
that  where  competition  is  possible  Italian  products  should  in  some 
directions  beat  ours  ;  but  there  is  yet  certainly  nothing  alarming 
in  the  situation,  and  we  have  no  cause  to  be  envious  of  her  pros- 
perity. At  present  the  total  export  and  import  trade  of  Italy  is, 
as  I  have  said,  well  under  £100,000,000,  and  the  bulk  of  the 
exports  —  silk,  oil,  wine,  marble,  and  glass  —  are  of  a  kind 
which  do  not  come  much  within  our  competing  range.  As  far 
as  the  direct  trade  with  Great  Britain  is  concerned,  it  is  not  on 
the  whole  steady  and  profitable,  and  amounts  to  about  an  eighth 
part  of  her  entire  commerce ;  Italy  buying  from  us  much  more 
largely  than  we  do  from  her,  although  the  discrepancy  is  less 
now  than  it  has  been,  owing  in  part,  I  fear  it  must  be  said,  to 
the  more  effectual  competition  of  French  manufacturers.  The 
consumption  of  Indian  and  Egyptian  raw  cotton  is  also. steadily 
increasing  in  Italian  mills,  although  these  are  in  great  part  still 
of  a  primitive  kind.  Some  progress  has  been  made  in  the  estab- 
lishment of  small  iron-works,  and  one  work  at  Venice,  belong- 
ing to  an  Englishman  named  Nevill,  has  attained  to  some  local 
celebrity.  Italy  possesses  few  iron  mines,  however,  and,  as  far 
as  we  know,  has  no  rich  contiguous  stores  of  iron  and  coal,  such 
as  are  essential  to  a  country  destined  to  lead  in  almost  any  branch 
of  skilled  production.1  We  must,  therefore,  after  making  all 
allowance  for  the  signs  of  local  activity  which  are  to  be  met  with 
in  the  country,  come  to  the  conclusion  that  Italy  is  not  in  a  posi- 
tion to  become  a  great  manufacturing  centre.  Her  people  are  by 
preference  pastoral ;  and  as  in  France,  although  the  tenure  of  the 
land  is  not  the  same,  large  tracts  of  the  soil  are  parcelled  out 


1In  Kolb's  Vergleichende  Statistik  it  is  stated  that  the  average  annual  value  of  the  pro- 
duction of  iron  in  Italy  in  the  years  1867-70  was  just  over  £800,000,  the  product  of  11,100 
workpeople ;  that  of  copper,  £53,000,  won  by  the  labor  of  2,500  workmen.  Coal  and  petroleum 
together  represented  the  insignificant  value  of  £126,000  and  gave  employment  to  3,450  work- 
men.  Lead  was  considerably  more  valuable  than  copper,  but  it  only  gave  an  average  of 
about  £330,000,  a  quantity  clearly  not  sufficient  for  home  consumption.  Italy  is,  in  fact,  a 
steady  consumer  to  England  for  the  metals  of  manufacture  and  for  coal. 


THE  RECENT  PROGRESS  OF  ITALY.        273 

amongst  small  holders,  whose  position  is  nearly  as  secure,  if  not 
so  independent,  as  that  of  the  French  peasant  proprietor,  and  the' 
attractions  of  the  workshops  are  not  sufficient  to  draw  a  compara- 
tively comfortable  and  by  no  means  crowded  population  from 
their  fields.1 

But,  though  not  a  great  manufacturing  nation,  Italy  is,  as  we 
have  seen,  advancing  in  several  respects  as  a  producer  of  articles 
meant  for  home  use,  and  her  tariff  is,  like  that  of  other  countries 

1  According  to  the  return  published  in  1861,  the  latest  which  seems  to  be  available,  about 
8,000,000  of  the  population  of  22,000,000  then  comprising  Italy  were  employed  in  agricultural 
pursuits,  and  a  nearly  equal  number  were  returned  as  "without  calling."  The  number 
engaged  in  mineral  production  was  less  than  60,000,  and  there  were  devoted  to  manufac. 
tures  about  3,100,000.  In  this  latter  would  of  course  be  included  all  the  local  tradesmen, 
the  shoemakers,  smiths,  carpenters,  masons,  and  clockmakers,  which  go  to  make  up  the 
population  of  the  villages,  so  that  the  numbers  engaged  actually  in  what  we  should  in  this 
country  call  manufactures  would  probably  not  reach  half  that  figure.  These  figures  are  not  of 
so  much  value  now,  however,  for  Italy  has  been  changed  and  opened  up  greatly  since  then, 
and,  in  some  of  the  northern  provinces,  manufactures  and  agriculture  overlap  each  other, 
so  that  the  same  people  ought  to  be  classed  in  both;  not  only  so,  but  the  addition  to  the 
population,  both  by  natural  increment  and  through  the  incorporation  of  fresh  provinces,  has 
materially  added  to  the  proportions  of  certain  classes.  Instead  of  .32,000,000,  Italy  has  now 
a  population  of  27,500,000,  of  which,  according  to  Behm  and  Wagner's  last  Annual,  on  the 
population  of  the  earth,  issued  in  Petermann's  Mittheilungen,  6,900,000,  or  25.7  per  cent., 
form  the  scattered  population,  the  remainder  being  gathered  in  the  cities,  towns,  and  agri- 
cultural villages  of  the  land.  I  am  unable  to  say,  however,  what  proportion  of  the  entire 
population  may  now  be  actually  employed  in,  or  directly  dependent  upon,  the  labor  of  the 
agriculturist.  From  an  official  report  lately  issued  on  the  state  of  the  Italian  agriculture  in 
the  years  1870-74,  of  which  copious  analyses  have  been  appearing  both  in  the  Economista 
d' 'Italia  and  in  the  Economiste  Francois,  I  learn  that  11,600,000  acres  of  land  are  devoted 
to  wheat,  and  yield  about  142,420,000,  bushels,  or,  roughly,  a  little  more  than  twelve  bushels 
to  the  acre,  — a  very  small  yield  for  so  rich  a  country,  and  the  best  commentary  we  could 
have  upon  the  exceeding  backwardness  of  agriculture.  Of  maize,  rice,  barley,  and  oats 
the  yield  was  rather  better,  as  the  following  table  will  show  :  — 

Total  yield  in  Yield  per 

Acres.                   Bushels.  Acre. 

Maize         .        .        .           4,242,000                  85,959,000  20.3 

Rice    ....             582,000                  27,000,000  46.4 

Barley  and  rye          .            1,162,000                   18,417,000  15.8 

Oats    ....             798,000                  10,471,000  25.6 

Allowing  for  the  difference  of  grains,  this  table  still  shows  great  variableness  in  the  yield. 
At  the  worst,  however,  Italy  compares  very  favorably  with  such  a  country  as  Russia,  where  the 
yield  per  acre  of  wheat  is  estimated  in  the  latest  returns  atonlyfive  and  a  half  bushels  per  acre. 
The  total  yield  of  wheat  in  Italy  is  indeed  within  15,000,000  bushels  of  that  of  Russia,  and 
leaves  a  considerable  margin  for  export.  Besides  these  grains  and  root  crops,  olives,  cotton, 
and  flax,  a  large  acreage  is  devoted  to  the  vine,  no  less,  according  to  the  table  from  which 
I  quote,  than  4,700,000  acres,  the  yield  upon  which  was  597,000,000  gallons  of  wine.  Alto- 
gether,  the  agricultural  land  in  Italy  included  in  the  official  returns  extends  to  68,000,000 
acres.  The  tendency  would  seem  to  be  to  extend  the  pasture  lands,  a  good  trade  offering  to 
Italy  in  cattle  with  Austria,  Switzerland,  and  France,  which  the  vegetarian  habits  of  the 
agricultural  population  enables  it  to  turn  to  better  account  than  the  mere  enumeration 
of  the  flocks  would  lead  one  to  suppose.  ,In  horses  particularly  Italy  is  poor,  and  she 
stands  numerically  in  all  kinds  of  animals  behind  Austria  and  Hungary,  but  for  all  that 
she  can  export  to  them. 


274  SELECTIONS. 

we  have  mentioned,  acting  as  a  strong  bulwark  to  protect  the 
'  home  producer  against  competition.  One  would  imagine,  for 
example,  that  in  the  matter  of  silk  the  Italian  manufacturer  would 
require  little  or  nothing  in  the  shape  of  protection,  seeing  that  he 
could  set  up  his  mills  in  the  heart  of  a  silk-growing  country,  and 
yet  Italy  levies  a  duty  on  all  kinds  of  silk  tissues  imported,  which, 
though  small,  is,  like  the  Indian  duties  on  cotton  goods,  sufficient 
to  debar  foreign  imports  to  a  considerable  extent,  and  to  raise 
prices  at  home.  Woollen,  cotton,  and  linen  fabrics  are  more 
heavily  taxed  still,  as  will  be  seen  in  the  note  which  I  append  ; * 
and,  speaking  generally  of  the  Italian  tariff,  we  may  say  that, 
instead  of  being  now  light  and  liberal,  as  Count  Cavour  wished 
it  to  be,  when  compared  with  that  of  other  European  countries, 
it  is  essentially  the  tariff  of  a  country  devoted  to  protectionist 

1  The  import  duty  charged  at  Italian  ports  on  silk  tissues  is  5  per  cent,  ad  valorem^  or  is. 
id.  per  Ib. ;  ribbons  pay  from  is.  lod.  to  as.  ud.  per  Ib.  if  of  silk  alone,  and  10  per  cent. 
ad  -valorem  if  mixed.  Only  silk  twist  is  admitted  free.  Cotton  yarn,  on  the  other  hand, 
pays  according  to  fineness,  and  to  whether  it  is  bleached  and  dyed  or  unbleached,  a  duty 
varying  from  6s.  id.  to  143.  id.  per  cwt.,  the  twists  and  double  yarns  and  bleached  and  dyed 
ditto  paying  respectively  us.  gd.  and  145.  id.  On  cotton  tissues  the  duty  is  very  heavy, 
varying  from  263.  5d.  on  unbleached  cotton  to  475.  on  cotton  prints  per  cwt.,  while  cotton 
embroidery  pays  £4  145.  $d.  per  cwt.  Woollen  yarn  comes  off  worse  still,  undyed  paying 
i8s.  pd.  and  dyed  28s.  3d.  per  cwt.,  while  woollen  cloths  pay  substantially  about  the  same 
nominal  duties  per  cwt.  as  cotton.  Blankets  and  carpets,  for  example,  are  charged  233.  6d. 
to  323.  6d.,  according  to  quality,  per  cwt. ;  tapes  and  lace  of  pure  wool,  or  mixed,  £4  135. 6d. 
Ordinary  woollen  tissues  or  cloths  pay,  however,  either  a  10  per  cent,  ad  valorem  duty,  or 
£3  55.  per  cwt.  What  the  incidence  of  much  of  this  taxation  is  according  to  the  values  of 
the  articles  taxed,  it  is  of  course  impossible  for  any  but  exporters  to  tell;  but  it  must  vary 
considerably,  and  in  some  instances,  when  the  cloth  is  of  a  cheap  kind,  represent  some- 
thing like  20  to  30  per  cent,  of  its  value,  or  more.  The  same  may  be  said  of  linen,  hempen, 
and  jute  fabrics,  all  of  which  pay  heavy  duties,  which,  if  nominally  less  in  amount  than 
those  levied  by  France  or  Russia,  are  by  their  rough  and  ready  mode  of  adjustment  prob- 
ably practically  as  prohibitory.  Measured  by  the  wealth  of  Italy,  compared  with  P" ranee, 
they  must  be  more  so.  As  to  iron  and  steel,  the  tariff  of  Italy  is,  if  anything,  more  foolish 
than  that  of  any  other  country  we  have  had  under  review,  because  in  this  instance  there  is 
nothing  to  be  protected  worth  speaking  of.  There  are  no  blown-up  hectic  home  industries 
in  iron  to  pamper  and  to  fine  the  people  for  the  maintenance  of,  as  in  the  United  States ;  and 
therefore  these  duties  have  here  not  even  the  irrational  excuse  which  the  States,  France, 
Austria,  and  Germany  may  plausibly  advance.  Italy  charges,  for  all  that,  a  duty  of  some 
sort  on  every  kind  of  iron  except  pig-iron  and  broken  scraps.  In  some  cases,  as,  for  ex- 
ample, rails,  the  duty  is  relatively  low,  only  some  5Jd.  per  cwt.,  or  gs.  2d.  per  ton;  but  in 
others  it  is  very  high, —  steel  wire  paying  93.  5d.;  rolled  and  .bar  steel,  55.  yd.;  plates, 
6s.  id.;  fine  iron  wire,  33.  3|d.;  tools  for  mechanics  or  agriculturists,  33.  gd.;  knives  of 
ordinary  kinds,  2os.  4d.;  and  with  fine  handles,  403.  8d.  per  cwt.  Steam-engine  boilers 
and  machinery  of  all  sorts  also  pay  duties  ranging  from  is.  7$d.  to  45.  lojd.  per  cwt.; 
agricultural  machines  being  admitted  at  the  lowest  scale.  All  this  indicates  an  extreme 
short-sighted  policy,  because  it  is  hampering  the  progress  of  the  community,  without  doing 
any  class  in  it  even  a  temporary  benefit,  or  bringing  the  government  much  profit.  And 
these  are  by  no  means  all.  Italy  taxes  the  import  of  food  grains,  of  meats,  of  sugar  (which 
pays  from  8s.  5d.  to  us.  9d.  per  cwt.,  according  to  fineness),  and  chemicals  (such  as  the 
alkalies  so  valuable  in  agriculture),  and  yet  with  it  all  the  gross  income  from  the  customs 
barely  reaches  £4,000,000  a  year. 


THE   RECENT   PROGRESS   OF   ITALY.  275 

ideas.  Driven  by  stress  of  poverty,  Italian  statesmen  not  pos- 
sessed of  the  political  sagacity  of  Count  Cavour  have  reimposed 
some  very  obnoxious  custom  duties,  and  increased  their  burden, 
without,  however,  adding  materially  to  the  yield,  while  certainly 
hindering  the  development  of  the  trade  of  the  nation.  Compared 
with  the  fragmentary  tariffs  in  force  in  1853,  the  duties  are,  how- 
ever, still  very  low,  and  Italy  should  get  credit  here  also,  for  at  all 
events  not  slipping  back  into  the  slough  from  which  she  emerged. 
Still,  the  present  tariff  is  higher,  in  a  good  many  instances,  than 
that  in  force  in  1863  and  1864,*  which  alarmed  the  short-sighted 
economists  of  the  country  by  the  smallness  of  its  yield ;  and  it 
is  apparently  further  beset  by  vexatious  provisions  and  excessive 
charges  which  aggravate  importers  and  cumber  business,  without 
yielding  any  adequate  return.  We  may  hope  then  that,  when 
the  time  comes  for  a  fresh  revision  of  the  general  and  special 
customs  tariffs  of  the  kingdom,  — as  come  it  speedily  must,  — a 
step  forward  will  be  taken,  and  that  England  will  be  admitted 
within  the  inner  circle,  if  Italy  cannot  find  it  in  her  heart  to  open 
her  gates  to  all  alike.  But  at  present  it  must  be  candidly  admit- 
ted that  the  signs  are  the  other  way.  From  year  to  year  Itajy 
has  been  going  to  revise  her  general  tariff,  but  hitherto  the  revi- 
sion has  been  postponed.  A  fragmentary  tariff  between  Italy  and 
France  was,  however,  signed  in  the  middle  of  July  last,  and  it 
indicates  rather  an  increase  of  fiscal  obstructiveness  than  the  re- 
verse. Sundry  duties  on  articles  specially  affecting  the  two 
countries,  such  as  wine  and  silk,  have  been  arranged  mostly  for 
the  worse,  and  Italy  has  distinguished  herself  in  particular  by 
large  additions  to  her  list  of  export  duties.  Altogether  this 
treaty  augurs  ill  for  free  trade,  and  ill  for  the  reciprocal  business 
of  Italy  and  France,  which  has  lately  been  flourishing  apace. 
We  may  rest  patiently,  therefore,  under  the  present  burdens  im- 
posed on  our  trade,  lest  a  worse  evil  befall  us.  A  few  years' 
further  experience  of  the  mischiefs  in  the  present  system  may  lead 
to  change  in  the  direction  of  freedom,  which  Italy  is  clearly  un- 
prepared for  now. 

Yet  it  would  be  decidedly  the  interest  of  Italy  to  revise  her 
tariff  in  a  free-trade  sense,  were  it  for  no  other  reason  than  that 
her  wealth  is  neither  mineral  nor  industrial  in  the  English  sense 
of  the  terms,  but  agricultural.  How  decidedly  Italy  is  a  pastoral 

i  See  table  in  Mr.  Merries'  Report,  pp.  597-599- 


2/6  SELECTIONS. 

country  is  seen  best  by  her  actual  foreign  trade;  the  staple  ex- 
ports of  Italy,  beyond  her  silk  and  her  small  amount  of  silk 
manufactures,  being  oil  and  wine,  fruits  and  seeds,  cereals  and 
hides,  timber,  animals,  hemp,  and  flax,  some  sorts  of  provisions, 
and  a  little  wool.  She  is  inevitably,  in  spite  of  the  development 
of  her  local  industries  and  manufactures,  much  dependent  on 
foreign  supply  for  many  necessary  articles  of  clothing,  for  much 
of  her  machinery  used  in  mills,  on  farms,  on  railways,  and  in 
steamboats.  Italy  is,  in  consequence,  and  in  spite  of  herself, 
therefore,  a  customer  of  growing  importance,  either  to  Great 
Britain  or  to  industrial  countries  such  as  France  or  Germany, 
and  she  ought  to  recognize  the  fact  so  as  to  make  the  bene- 
fits as  much  as  possible  mutual.  For  example,  she  took  from 
us  alone,  in  1875,  about  £2,600,000  worth  of  cotton  yarn  and 
piece  goods,  besides  what  may  have  reached  her  indirectly, 
and  a  considerable  amount  of  iron  and  iron  manufactures,  as 
well  as  woollen  goods  and  coal.  The  character  of  her  trade 
with  us  is  very  decidedly  fixed  by  the  tariff,  however,  and 
we  discover  here,  as  in  the  case  of  France,  a  tendency  to 
take  from  us  raw  or  half-manufactured  articles  in  increasing 
quantities,  rather  than  the  finished  goods.  It  is  not  satis- 
factory, for  instance,  from  our  point  of  view,  to  find  that  the 
value  of  cotton  yarn  entered  for  Italy  was,  in  1875,  almost  as 
large  as  the  value  of  the  cotton  cloths.  It  shows  us  that,  how- 
ever unfitted  Italy  may  be  by  nature  and  circumstances  to  become 
a  great  manufacturing  country,  she  can  at  least  secure  the  tem- 
porary advantage  of  being,  in  a  considerable  measure,  her  own 
provider.  Still  less  satisfactory  is  it  to  find  that  for  some  years 
France  has  been  gaining  steadily  where  we  have  been  losing,  and 
that  although  our  general  trade  with  Italy  gives  few  signs  of 
weakness,  but  rather  the  reverse,  our  cotton  manufacturers  are 
being  decidedly  elbowed  out  of  her  market. 

The  following  tables  given  by  Mr.  Malet  in  his  report  to  the 
Foreign  Office  on  the  trade  of  Italy  for  1875,  will  show  the  posi- 
tion most  clearly  :  — 


THE  RECENT  PROGRESS  OF  ITALY. 


277 


Table  showing'  the  Value  of  Imports  from  England  and  France  to  Italy  of  Tissues  of  Hemp 
or  Flax  of  less  than  nine  threads  of  Warp  in  the  space  of  Jive  Millimetres,  whether  Raw 
or  Bleached,  during1  the  five  years  ending  December  31,  1875. 


1871. 

1872. 

1873. 

1874. 

1875. 

FR. 

FR. 

FR. 

FR. 

FR. 

' 

Table  showing  the  Value  of  Imports  from  England  and  France  to  Italy  of  Cotton  Tissues, 
also  mixed  with  Thread  and  Wool,  Colored,  Dyed,  or  Printed,  during  the  five  years 
ending  December  31,  1875. 


1871. 

1872. 

1873. 

1874. 

1875. 

England  .'  — 

FR. 

FR. 

FR. 

FR. 

FR. 

C                 d     d 

267 

Printed    

17,778,000 

14,020,000 

14,475,000 

10,633,000 

12,696,000 

24,510,000 

22,478,000 

22,814,000 

14,900,000 

18,225,000 

France  :  — 

Cotton  or  dyed  

2,620,000 

3,727,000 

4,497,000 

5,566,000 

6,649,000 

Printed       .          ... 

7,931,000 

10,053,000 

12,245,000 

13,732,000 

15,123,000 

Table  showing  the  Value  of  Imports  from  England  and  France  into  Italy  of  Tissues  of 
Wool  or  Hair,  also  mixed  with  Cotton  or  Thread,  during  the  five  years  ending'  Decem- 
ber yiti&ft. 


1871. 

1872. 

1873. 

1874. 

1875. 

England:  — 

FR. 

FR. 

FR. 

FR. 

FR. 

Paying  ad  valorem  duties, 

16,542,000 

15,734,000 

12,485,000 

9,521,000 

10,873,000 

Paying  by  weight  .... 

3,170,000 

3,103,000 

3,533,000 

3,204,000 

3,074,000 

19,712,000 

18,837,000 

16,018,000 

12,725,000 

13.947,000 

France:  — 

Paying  ad  valorem  duties, 

7,231,000 

9,225,000 

10,500,000 

11,015,000 

14,471,000 

Paying  by  weight  .... 

4,918,000 

6,653,000 

6,926,000 

7,812,000 

6,831,000 

12,149,000 

15,878,000 

17,462,000 

18,827,000 

21,302,000 

Embassy  and  Legation  Reports,  Part  II.,  1877,  p.  137. 


2/8  SELECTIONS. 

These  figures  are  of  a  sufficiently  startling  kind,  and  would 
seem  to  make  good  the  contention  of  Mr.  Malet,  that  French 
manufacturers  have  now  the  advantage  of  us.  There  is  no  reason 
to  be  alarmed  at  that  fact,  even  supposing  it  true,  and  least  of  all 
as  regards  Italy,  which  is  France's  next  door  neighbor  ;  but  I  am 
disposed  to  think  that  the  importance  of  this  growth  of  the  French 
trade  in  tissues  might  be  easily  exaggerated,  and  that  were  trade 
to  be  made  free,  we  should  regain  a  considerable  part  of  the  ground 
we  have  lost.  At  present  both  tariff  and  freight  are  against  us, 
and  the  freight  probably  turns  the  scale  as  compared  with  France, 
more  than  anything  else.  And  these  figures  at  least  tend  to  con- 
firm the  statement  that  Italy  is  dependent  on  foreign  supply  in 
most  important  branches  of  manufacture.  Her  tariff  may  give  a 
certain  forced  prosperity  to  some  of  her  endeavors  to  become  a 
rival  of  England  and  France,  but  she  has  no  other  advantage  than 
her  tariff  gives,  for  living  is  not  much  cheaper  for  the  working 
classes  in  Italy  than  here,  and,  as  a  rule,  they  are  less  capable, 
more  ignorant,  and  more  disposed  to  "  scamp"  work  than  our 
own,  so  that,  with  wages  nominally  on  a  lower  scale,  the  real 
cost  of  production  in  Italy  is  probably  higher  than  here.  I  have 
not,  indeed,  attempted  to  discuss  in  any  adequate  way  the  "  labor 
element"  or  the  "wages  element,"  in  dealing  with  the  competing 
capacities  of  other  countries  in  contrast  with  our  own,  because,  in 
my  judgment,  they  are  of  comparatively  secondary  importance  to 
the  primary  forces  of  reserves  of  capital,  of  habit,  and,  above  all, 
of  geographical  and  physical  adaptabilities.  Against  the  enor- 
mous advantage  which  England  still  possesses  over  almost  all  other 
countries  in  most  respects,  were  she  free  of  the  markets  of  the 
world  as  the  world  is  free  to  hers,  the  labor  and  wages  elements 
have,  in  my  opinion,  little  force.  It  is  not  labor  itself  so  much  as 
the  facilities  for  applying  labor  in  all  departments  of  manufacture 
in  the  most  economic  manner  possible  which  determines  the 
battle,  and  in  these  facilities  no  country  in  the  world  can  hope  for 
some  time  to  rival  us.  So  far,  therefore,  as  the  policy  of  Italy 
tends  to  fight  against  this  superiority,  I  hold  it  to  be  mistaken ; 
but  it  is  a  policy  which  we  cannot  immediately  hope  to  see 
departed  from  there  or  elsewhere  ;  and  we  cannot  therefore  expect 
that  the  present  reaction,  partly  the  result  of  over-speculation, 
partly  artificial,  will  soon  end  even  in  increased  demand  from  Italy 
for  our  woven  fabrics,  although  in  regard  to  our  general  trade 
with  that  country  we  have  good  reason  to  be  hopeful. 


THE   RECENT   PROGRESS   OF  ITALY.  279 

Left  unforced,  the  course  which  Italy  might  pursue  with  most 
advantage  to  herself  and  to  the  world,  as  a  commercial  nation,  is 
very  clearly  marked  out  by  her  poverty,  her  physical  peculiari- 
ties, and  her  geographical  situation.  To  the  first  we  shall  refer 
again  presently.  As  to  the  second  we  need  only  say  that  the 
highly  favored  climate  and  rich  soil  of  Italy  render  her  admirably 
adapted  for  the  production  of  wine,  oil,  sugar,  maize,  and  choice 
fruits,  for  which  she  would  find,  and  does  find,  a  ready  market, 
not  in  Europe  only,  but  also  in  the  East,  and  in  America,  North 
and  South.  Already  a  considerable  trade  is  established  with  the 
United  States,  for  instance,  and  the  large  flow  of  Italian  emigra- 
tion to  that  region,  as  to  Brazil  and  the  River  Plate,  tends  to  ex- 
lend  this  kind  of  commerce.  But  for  the  backward  character  of 
Italian  agriculture,  which,  except  in  Piedmont  and  perhaps  part 
of  Lombardy,  is  hardly  worthy  the  name  of  tillage  at  all,  Italy 
might  to-day  be  much  more  prominent  as  a  rival  of  France  in  the 
supply  of  luxurious  nations  with  dainties,  and  of  physically  ill- 
conditioned  countries  with  cheap  food.  With  Italy,  as  with 
France,  it  is  the  fruits  of  the  earth  which  must  form  the  solid 
basis  of  all  her  trade.  To  much  of  the  rest  of  the  world  these 
fruits  are,  or  might  become,  delicacies  of  the  most  precious  kind  ; 
and,  therefore,  whatever  Italy  does  to  develop  agriculture  is  better 
than  the  establishment  of  a  dozen  unhealthy  factories.  In  some 
measure  the  Italian  government  may  be  said  to  see  this,  inas- 
much as  they  devote  a  considerable  amount  of  attention  to  agri- 
cultural education,  establish  depots  of  agricultural  implements  in 
various  districts  for  the  purpose  of  educating  the  people,  and  so 
forth ;  but  that  is  only  toying  with  the  great  reforms  needed, 
which  must  include  a  wide  remodelling  of  the  fiscal  burdens,  a 
new  cadastral  survey,  followed  by  a  revised  land  tax,  and  the  pro- 
tection of  the  tillers  of  the  soil  alike  from  the  extortions  of  their 
do-nothing  landlords  and  the  robberies  of  the  brigand.  Recent 
letters  from  Italy  have  shown  the  Italians  to  be  morbidly  sensitive 
to  this  last  subject ;  and  the  curious  vanity  which  they  have  dis- 
played about  their  rights  and  liberties  is  not  pleasant.  For  cer- 
tainly this  brigand  question  is  more  vital  to  the  true  settlement  and 
prosperity  of  southern  Italy  than  almost  any  other.  Until  the 
nefarious  robbers  are  extirpated,  and  the  so-called  upper  classes 
of  the  towns  —  the  remnant  of  a  debased  and  corrupt  nobility  — 
prevented  from  aiding  and  abetting  them  in  their  depredations, 
Italy  cannot  advance  as  an  agricultural  nation.  Her  peasantry, 


280  SELECTIONS. 

unable  to  cultivate  the  vine,  the  olive,  and  the  citron  in  peace, 
must  remain,  over  almost  half  the  land,  degraded,  stupid,  and 
wasteful.  Instead  of  strutting  about,  talking  of  national  dignity, 
therefore,  Italian  statesmen  would  do  well  quietly  to  set  about  the 
task  of  making  each  man's  life  and  property  secure  through  the 
length  and  breadth  of  the  land.  Unless  they  do  so,  their  work 
may  one  day  be  partially  undone,  and  the  country,  ill-taxed  and 
overtaxed,  poor  and  vexed  by  thieves  and  priests,  may  see  itself 
outstripped  on  every  hand.  In  vine-growing  now  it  cannot  for  a 
moment  compete  with  France  or  Spain,  hardly  with  Greece  ;  in- 
deed, but  for  the  dishonest  trade  with  France  in  bad  wines,  used 
for  adulteration,  the  export  wine  trade  of  the  mainland  would  be 
of  hardly  any  value  at  all,  and  no  Italian  wine  is  known  widely 
in  England  except  the  Sicilian  Marsala.  If  she  does  not  take 
care  her  silk  trade  will  be  in  like  danger  from  the  competition  of 
our  Australian  colonies,  as  well  as  from  that  of  China  and  Japan. 
Italy  has  done  much  ;  but  what  she  has  done  only  brings  into 
most  startling  relief  all  that  she  has  to  do.  And,  latterly,  not  the 
tariff  only,  but  several  acts  of  internal  administration,  show  signs 
of  retrogression  rather  than  progress,  which  the  best  friends  of 
Italy  must  lament  over.  Her  apathetic  deputies  are  far  too  dis- 
posed to  shirk  their  duties,  and  would  do  better  to  display  the 
fire  and  hot-headedness  of  the  French  Assembly  than  the  selfish 
absenteeism  now  so  common,  which  make  the  Sardinian  again 
begin  to  think  that  he  has  nothing  to  do  with  the  affairs  of  Lom- 
bardy  ;  the  Lombard  indifferent  to  what  interests  Venice  ;  and  all 
the  North  together  agree  in  looking  with  something  like  cold  dis- 
like on  the  troubles  of  Sicily  and  the  South.  Ministers,  aided  by 
such  a  Parliament,  are  hardly  to  be  blamed  if  they  sometimes  go 
backwards  in  their  attempt  to  keep  the  State  solvent ;  and  not  the 
least  unsatisfactory  feature  is  the  little  help  they  get  from  the  king, 
who,  but  for  his  family,  might  ere  now  have  ruined  all  the  fair 
prospect.  • .-  • 

Reverting  to  the  position  of  Italy  as  preeminently  an  agricultu- 
ral country,  I  may  enumerate  a  few  of  the  clogs  which  prevent 
her  progress  in  this  direction.  The  reestablishinent  of  the  grist 
tax  was,  for  example,  a  distinctly  retrograde  movement.  It  costs 
the  nation,  directly  and  indirectly,  perhaps  five  times  as  much  as 
it  yields.  The  mere  irritation  to  which  the  millers  who  grind 
the  corn  and  those  who  own  it  are  alike  subject  must  be  very  dis- 
piriting, and  check  agricultural  progress.  Again,  Italy  copies 


THE  RECENT  PROGRESS  OF  ITALY.        28 1 

French  fashions  a  good  deal  in  the  manner  of  her  taxation  ;  and 
we  find  all  the  array  of  succession  duties,  mortmain  dues, 
stamps,  taxes  on  locomotion,  licenses,  and  such  like,  in  full  sway. 
Some  of  them  are  wise  and  fair  enough,  and  might  bear  increas- 
ing, were  their  incidence  fairly  distributed  ;  but  many  of  them 
are  obstructive  and  injurious  to  the  prosperous  growth  of  the 
national  wealth.  Italy  also  has  her  tobacco  monopoly,  on  the 
security  of  which  she  raised  a  loan  for  £9,500,000  in  1868,  and  who 
shall  say  that  it  is  not  hurtful  to  her  true  interests?  But  of  wider 
scope  for  evil,  almost  unproductive  as  they  are,  we  must  charac- 
terize the  export  duties  now  levied  on  many  articles  of  vital  im- 
portance to  Italy.  These  duties  have,  like  those  on  imports, 
been  increased  in  recent  years  under  the  plea  of  necessity,  and 
now  act  as  a  serious  barrier  on  free  export.  A  low  customs  duty 
on  expoits  may  do  more  harm  than  a  higher  one  on  imports, 
because  it  cripples  the  nation  in  competition  directly,  and,  as  it 
were,  at  the  sources  of  its  life ;  and  no  country  is  so  exclusively 
possessed  of  advantages  in  the  production  of  any  particular  article 
as  to  be  safe  under  such  hindrances.  The  liberal  Sardinian 
customs  law  of  1854  was  mucri  inveighed  against  at  the  time  it 
came  into  force,1  and  when  its  benefits  were  spread  partially  over 
the  rest  of  the  kingdom  of  Italy  the  manufacturing  classes  looked 
as  usual  for  ruin.  Of  course  no  such  ruin  took  place.  On  the 
contrary,  Sardinia  prospered  then,  and  Italy  has  prospered  always 
in  proportion  to  the  liberality  of  her  commercial  policy ;  and  if 
many  branches  of  her  agricultural  industry  stagnate  now,  it  is  be- 
cause, apart  from  general  causes  affecting  all  trade,  she  has  gone 
backwards  in  her  fiscal  laws.  Her  small  manufactures  have 
ever  been  benefited  by  the  lowering  of  her  tariff.  After  the  pass- 
ing of  the  liberal  import  tariff,  the  import  of  raw  cotton  rose 
from  an  average  of  about  6,500.000  Ibs.,  to  over  17,000,000  Ibs., 
and  in  other  respects  home  industries  such  as  these  were  bene- 
fited. What  has  thus,  as  always,  proved  true  in  the  case  of  imports 
holds  good  with  still  greater  force  in  regard  to  exports,  because  a 
tax  on  production  is  of  all  taxes  the  most  wasteful.  Make  bread 
dear  and  you  make  life  hard  ;  and  in  like  manner  put  a  barrier 
between  the  tiller  of  the  soil  and  a  free  market  in  any  raw  prod- 
uce, and  you  strike  at  the  root  of  the  entire  national  prosperity. 
This  is,  unfortunately,  what  Italy  has  in  no  small  measure  done 

»  Mr.  Herries'  Report,  p.  589,  et  seq. 


282  SELECTIONS. 

by  her  grain  taxes,  her  grist  tax,  and  her  vexatious,  barren  export 
duties,  to  which  she  has,  in  her  special  treaty  with  France,  lately 
made  large  additions.  Let  her  take  a  lesson  from  the  policy  of 
her  greatest  statesman  and  repeal  these,  and  she  will  have  done 
more  to  stimulate  agriculture  than  all  her  schools  and  exhibitions 
ever  can  do.  On  the  whole,  agriculture  may  be  pronounced 
now  more  burdened  than  manufactures,  since  the  recent  tinkering 
at  the  general  tariff  has,  in  various  ways,  increased  the  pressure  on 
this,  the  all-important  source  of  her  prosperity.  I  will  give  below 
Mr.  Herries'  figures,  comparing  the  present  export  duties  charged 
on  a  few  of  the  principal  articles,  with  those  in  force  in  1863  and 
1864,  which  was  the  period  when  the  tariff  was  lowest.1  Hard 
necessity  may  be  pleaded  for  this  backward  movement,  as  for 
that  in  the  import  duties ;  but  no  such  plea  can  be  admitted  for  a 
moment,  inasmuch  as  taxation  of  this  kind  tends  to  keep  agricult- 
ure, and  all  that  depends  on  it,  primitive  and  unproductive. 
Therefore  this  policy  does  also,  and  necessarily,  lessen  the  tax- 
paying  power  of  the  community  and  the  coherence  of  the  young 
State.  The  whole  fiscal  system  of  Italy  thus  requires  to  be  re- 
modelled, special  favoritism  in  tariffs  done  away  with,  and  the 
duties  which  cannot  be  dispensed  with,  levied  with  as  little  irk- 
someness  as  possible  on  the  articles  that  can  bear  a  tax  with  the 
least  injury  to  the  country.  Till  this  is  done  the  trade  of  Italy 
will  not  grow  as  it  ought  to  do  now  in  the  directions  which 
nature  has  marked  out  for  it,  and  I  will  even  say  that  the  con- 

1  ITALIAN  EXPORT  DUTIES. 

On  August  i,  1863.  1877. 

Lira.    Cents.        Lira.  Cents. 

Lime,  per  hectolitre free.  i  10 

Lime,  per  bottle "  o  06 

Olive  oil,  per  100  kilog. o           33  i  10 

Volatile  oil,  per  100  kilog free.  2  20 

Lemon  juice,  per  100  kilog «  {  °  '7 

(  i  10 

Extract  of  aloes,  per  100  kilog "  3  30 

Oranges  and  lemons,  per  100  kilog "  o  28 

Meat,  fresh  or  salted,  per  100  kilog "  2  20 

Cheese,  per  100  kilog <<  4  40 

Bulls  and  oxen,  per  head "  5  So 

Hides  and  skins,  per  100  kilog "  2  20 

Wool,  per  loo  kilog "  6  60 

Silk,  raw,  per  100  kilog "  38  50 

Silk,  waste,  per  100  kilog "  8  5° 

Unspecified  dried  fruits,  per  100  kilog "  i  10 

Almonds,  per  100  kilog "  j1  °S 

f  i  30 

Report,  p.  599. 


THE   RECENT   PROGRESS   OF  ITALY.  283 

solidation  of  the  races  which  inhabit  the  peninsula  cannot  be 
held  assured  while  their  free  development  is  in  this  manner  for- 
bidden. 

We  may,  then,  I  think,  put  aside  all  fear  both  that  Italy  will  be- 
come a  rival  to  England  in  any  of  her  important  branches  of  manu- 
facture, and  that,  once  unfettered,  she  will  cease  to  be  a  progres- 
sive customer.  The  character  of  the  trade  between  the  two 
countries  may  vary  in  some  measure,  and  the  competition  of 
other  countries  may  grow,  in  certain  directions,  more  effective ; 
but  I  do  not  think  that  these  will  cause  our  Italian  trade  to  grow 
less  in  bulk  or  value,  and  a  liberal  well-organized  and  classified 
tariff  in  Italy  would,  I  am  sure,  make  it  year  by  year  greater,  to 
the  benefit  of  both  countries. 

But  there  is  another  direction  in  which  I  think  Italy  may  not 
only  rival  us,  but  become  in  a  great  degree,  and  within  well- 
defined  limits,  a  monopolist,  if  she  goes  on  as  she  has  done 
these  last  dozen  years.  Her  geographical  position  peculiarly 
fits  her  to  become  again  the  distributing  and  carrying  mari- 
time nation  for  Central  Europe  and  the  Levant.  I  do  not  dream 
of  a  revived  Venice.  Venice  may  indeed  flourish  again  in  a 
modest  way,  but  not  as  a  great  port  and  mart  for  the  civilized 
world.  I  mean,  rather,  that  the  sea-borne  trade  of  Italy  and  of 
the  neighbors  of  Italy  along  the  Greek  archipelago,  in  Egypt 
and  Syria,  and  possibly  even  in  the  Black  Sea  and  the  Danube, 
seems  likely  to  be  carried  on  more  and  more  in  Italian  ships,  and 
that  her  merchant  marine  may  in  time  come  to  be  no  mean  rival 
of  that  of  England  in  those  regions  of  the  South  and  East.  The 
progress  of  Italian  shipping  since  the  establishment  of  the  king- 
dom is  evidence  that  in  this  direction  she  has  already  taken  con- 
siderable strides.  Italian  vessels  not  only  nearly  monopolize  the 
coasting  trade  of  the  Adriatic  and  Mediterranean  ports  near 
her  borders,  but  the  Rubattino  line  of  ocean  steamers,  sailing 
from  Genoa  and  other  ports,  compete  successfully  with  the  Aus- 
trian Lloyd's  and  the  French  Messagerie  Maritime  lines  in  the 
Eastern  seas,  while  two  other  important  lines,  the  Florio  and  the 
Pierano,  are  fast  sweeping  into  Italian  hands  the  heaviest  share 
of  the  trade  of  the  Mediterranean  and  the  Levant.  Moreover,  the 
fact  that  our  own  mail  company,  the  once  unrivalled  Peninsular 
and  Oriental,  is  compelled  to  make  a  depot  at  Brindisi,  is  itself 
a  sign  of  change  in  the  position  of  the  Eastern  trade.  As  yet,  this 
depot  may  be  said  to  exist  only  for  the  convenience  of  overland 


284  SELECTIONS. 

passengers  and  fast  mails,  but  goods  will  be  sure  to  follow  in 
time  this  overland  route  to  some  extent,  and  a  certain  portion  of 
the  carrying  trade  of  England  become  diverted  to  Italy.  The 
Suez  Canal  has  hitherto  been  almost  an  English  water-way,  and 
will,  no  doubt,  long  continue  to  be  used  in  a  predominating 
degree  by  English  ships  ;  but  it  obviously  makes  competition  by 
a  country  situated  as  Italy  is  much  easier  than  it  was  before,  and 
that  competition  is  now  felt,  fostered  as  it  is  by  the  postal  sub- 
sidies which  the  Italian  government,  in  imitation  of  our  own, 
gives  to  the  Rubattino  company.  Looking  at  the  map,  we  see 
that  the  harbors  of  Italy  are,  as  it  were,  placed  directly  in  the 
way  of  ships  coming  westward  through  the  Canal,  and  the 
Asiatic  trade  which  the  discovery  of  the  Cape  passage  threw  into 
the  hands  of  the  Dutch,  the  Portuguese,  and  the  English,  to  the 
ruin  of  Venice  and  Genoa,  may  not  unlikely  tend  now  to  revert 
in  some  measure  to  its  old  channels.  Steam,  no  doubt,  neutral- 
izes the  altered  circumstances  somewhat,  but  not  altogether. 
Once  let  Central  Europe  get  consolidated  into  peaceful  com- 
munities, Turkey  become  pacified  or  obliterated  as  a  separate 
State,  to  be  replaced  by,  at  worst,  less  devastating  governing 
agencies,  and  we  may  expect  the  trade  of  Italy  as  a  common 
carrier  on  the  seas  to  be  greatly  extended  in  that  quarter.  The 
cotton  mills  which  she  possesses,  or  that  may  exist  in  Austria, 
Hungary,  and  Bavaria,  are  likely  to  draw  their  supplies  of  In- 
dian cotton  direct  from  the  ports  of  shipment,  or  by  Italian  ships, 
almost  direct,  instead,  as  heretofore,  through  England.  Marts 
for  the  raw  produce  of  India  and  China  are  thus  not  unlikely  to 
spring  up  in  Genoa  and  Leghorn,  if  not  in  Venice  and  Naples, 
just  as  a  wool  mart  is  now  rising  into  importance  at  Antwerp  ; 
and  London  will  then  no  longer  occupy  the  exclusive  position 
which  the  wars  and  follies  of  her  neighbors  have  maintained  her 
in  for  so  long. 

Nor  need  Italy  halt  with  the  Eastern  trade.  Her  connections 
with  the  Brazils  and  South  America,  as  well  as  with  the  United 
States  and  the  islands  in  the  Spanish  Main,  are  extending,  though 
comparatively  insignificant  now,  and,  unless  emigration  from  her 
shores  ceases,  are  likely  to  extend,  for  a  large  Italian  population 
is  now  scattered  over  the  fairest  regions  of  South  America. 

Therefore,  although  I  do  not  think  that,  as  manufacturers,  we 
have  much  cause  to  look  on  Italy  with  any  dread,  as  a  competitor 
for  a  portion  of  the  European  carrying  trade,  which  has  been  so 


THE   RECENT   PROGRESS   OF   ITALY.  285 

long  in  our  hands,  in  all  its  most  valuable  departments,  I  think 
we  have  good  reason  to  have  misgivings.  Italy  is,  in  my  opinion, 
destined  to  make  a  more  marked  impression  on  our  monopoly  in 
her  own  immediate  neighborhood  than  almost  any  other  European 
nation,  and  may  yet  become  a  far-reaching  rival.  Even  at  present 
Italy  stands  forward  amongst  the  nations  of  the  world  as  a  great 
ship-owning  nation.  The  only  European  country  that  is  ahead  of 
her  besides  ourselves  is  Norway,  which  has  always  been  promi- 
nent with  its  seafaring  population,  who  have  much  of  the  carrying 
trade  of  Germany,  Russia,  and  Denmark  in  their  hands.  Year 
by  year,  until  the  last  two  years,  when  depressed  trade  has  pro- 
duced some  slackening,  the  tonnage  of  foreign  vessels  entering  our 
ports  has  been  on  the  increase,  and  of  this  increase  Italy  bears  its 
full  share. 

We  must  accept  Italian  competition  on  the  sea  as  a  factor  of 
growing  importance,  therefore,  and,  instead  of  being  jealous  of  it, 
seek  to  utilize  it  where  it  can  serve  our  ends,  just  as  we  allow 
other  countries  to  use  our  shipping  for  theirs.  There  must  be  free 
trade  in  ship  freights  as  in  everything  else,  and  in  the  meantime 
we  need  have  no  fear  that  Italy  will,  for  a  long  time  to  come, 
drive  us  from  the  markets  for  our  manufactures,  if  ever  she  does 
it.  While  her  budgets  show  an  annual  deficit,  while  her  paper 
currency  is  always  at  a  discount  which  seldom  sinks  much  below 
ten  per  cent.,  while  her  population  remains  pastoral,  and  while 
her  internal  administration  is  but  half  organized,  and  her  taxation 
oppressive,  she  cannot  run  far  in  the  race  with  us,  or  with  any 
manufacturing  country  ;  and  for  ourselves,  free  trade  is,  after  all, 
our  great  stronghold.  When  we  recognize  how  far  behind  us  in 
this  respect  all  other  nations  yet  are,  we  may  be  easy  in  our  minds, 
provided  always,  of  course,  we  continue  to  work  as  heretofore. 
Free  trade  will  do  nothing  for  a  nation  of  sloths.  At  present,  I 
see  no  signs  anywhere  that  other  countries  are  in  the  least  likely 
to  be  more  diligent  than  we  are.  Italy,  at  all  events,  gives  no 
such  indication,  and  against  her  competition  we  can  not  only  pit 
superior  and  freer  industry,  but  a  higher  order  of  agriculture,  a 
system  of  internal  taxation,  on  the  whole,  less  oppressive,  and 
natural  and  acquired  advantages,  such  as  it  takes  generations  to 
bring  into  play.  For  the  rest,  if  on  the  high  seas  her  ships  should 
threaten  to  rival  our  own,  we  can  only  hope  that  the  trade  of  the 
world  will  become  large  enough  to  afford  them  plenty  to  do  with- 
out lessening  the  employment  of  ours. 


286  SELECTIONS. 


XIV. 

THE    UNITED    STATES    IN    1880. 
THE    INCREASE    OF   POPULATION  FROM   ijqo    TO    1880. 

FROM  WALKER  AND  GANNETT'S   REPORT  ON  THE   PROGRESS  OF  THE 
NATION.     TENTH  CENSUS,  VOL.  I.,  PP.  xn-xx. 


THE  First  Census  of  the  United  States,  taken  as  of  the  first 
Monday  in  August,  1790,  under  the  provisions  of  the  second  sec- 
tion of  the  first  article  of  the  Constitution,  showed  the  population 
of  the  thirteen  States  then  existing  and  of  the  unorganized  terri- 
tory, to  be,  in  the  aggregate,  3,929,214. 

This  population  was  distributed  almost  entirely  on  the  Atlantic 
seaboard,  extending  from  the  eastern  boundary  of  Maine  nearly 
to  Florida,  and  in  the  region  known  as  the  Atlantic  plain.  Only 
a  very  small  proportion  of  the  inhabitants  of  the  United  States, 
not,  indeed,  more  than  five  per  cent.,  was  then  to  be  found  west  of 
the  system  of  the  Appalachian  mountains.  The  average  depth 
of  settlement,  in  a  direction  at  right  angles  to  the  coast,  was  255 
miles.  The  densest  settlement  was  found  in  Eastern  Massa- 
chusetts, Rhode  Island,  and  Connecticut,  and  about  New  York 
City,  whence  population  had  extended  northward  up  the  Hudson, 
and  was  already  quite  dense  as  far  as  Albany.  The  settlements 
in  Pennsylvania,  which  had  started  from  Philadelphia,  on  the 
Delaware,  had  extended  northeastward,  and  formed  a  solid  body 
of  occupation  from  New  York,  through  Philadelphia,  down  to 
the  upper  part  of  Delaware. 

The  Atlantic  Coast,  as  far  back  as  the  limits  of  tide-water,  was 
well  settled  at  that  time  from  Casco  Bay  southward  to  the  north- 
ern border  of  North  Carolina.  In  what  was  then  the  District  of 
Maine,  sparse  settlement  extended  along  the  whole  seaboard. 
The  southern  two-thirds  of  New  Hampshire  and  nearly  all  of 
Vermont  were  covered  by  population.  In  New  York,  branching 
off  from  the  Hudson  at  the  mouth  of  the  Mohawk,  the  line  of 
population  followed  up  a  broad  gap  between  the  Adirondacks 


U.    S.    POPULATION,    l/QO.  287 

and  the  Catskills,  and  even  reached  beyond  the  centre  of  the 
State,  occupying  the  whole  of  the  Mohawk  valley  and  the  country 
about  the  interior  New  York  lakes.  In  Pennsylvania  population 
had  spread  northwestward,  occupying  not  only  the  Atlantic  plain, 
but,  with  sparse  settlements,  the  region  traversed  by  the  numerous 
parallel  midges  of  the  eastern  portion  of  the  Appalachians.  The 
general  limit  of  settlement  was,  at  that  time,  the  southeastern 
edge  of  the  Allegheny  plateau,  but  beyond  this,  at  the  junction  of 
the  Allegheny  and  Monongahela  rivers,  a  point  early  occupied  for 
military  purposes,  considei'able  settlements  had  been  established 
prior  to  the  War  of  the  Revolution.  In  Virginia  settlements  had 
extended  westward  b*eyond  the  Blue  Ridge,  and  into  what  is  now 
West  Virginia,  on  the  western  slope  of  the  Allegheny  mountains, 
though  very  sparsely.  From  Virginia,  also,  a  narrow  tongue  of 
settlement  had  penetrated  down  to  the  head  of  the  Tennessee 
river,  in  the  great  Appalachian  valley.  In  North  Carolina  the 
settlements  were  abruptly  limited  by  the  base  of  the  Appalachians. 
The  State  was  occupied  with  remarkable  uniformity,  except  in  its 
southern  and  central  portion,  where  population  was  compara- 
tively sparse.  In  South  Carolina,  on  the  other  hand,  there  was 
evidence  of  much  natural  selection,  apparently  with  reference  to 
the  character  of  soils.  Charleston  was  then  a  city  of  considerable 
magnitude,  and  about  it  was  grouped  a  comparatively  dense 
population  ;  but  all  along  a  belt  running  southwestward  across 
the  State,  near  its  central  part,  the  settlement  was  very  sparse. 
This  area  of  sparse  settlement  joined  with  that  of  Central  North 
Carolina,  and  ran  eastward  to  the  coast,  near  the  junction  of  the 
two  States.  Further  westward,  in  the  "up  country"  of  South 
Carolina,  the  density  of  settlement  was  noticeably  due  to  the  im- 
provement in  soil.  At  this  date  settlements  were  almost  entirely 
agricultural,  and  the  causes  for  variation  in  their  density  were 
general  ones.  The  movements  of  population  at  this  epoch  may 
be  traced  in  almost  every  case  to  the  character  of  the  soil,  and  to 
facility  of  transportation  to  the  seaboard;  and,  as  the  inhabitants 
were  then  dependent  mainly  upon  water  transportation,  we  find 
the  settlements  also  conforming  themselves  very  largely  to  the 
navigable  streams. 

Outside  the  area  of  continuous  settlement,  which  we  have  at- 
tempted to  sketch,  were  found,  in  1790,  a  number  of  smaller  set- 
tlements of  greater  or  less  extent.  The  principal  of  these  lay  in 
Northern  Kentucky,  bordering  upon  the  Ohio  river,  comprising 


288  SELECTIONS. 

an  area  of  10,900  square  miles.  Another,  in  Western  Virginia, 
lay  upon  the  Ohio  and  Kanawha  rivers,  and  comprised  750  square 
miles.  A  third,  in  Tennessee,  upon  the  Cumberland  river,  em- 
braced 1,200  square  miles. 

In  addition  to  these,  there  were  a  score  or  more  of  small  posts, 
or  incipient  settlements,  scattered  over  what  was  then  dh  almost 
untrodden  wilderness,  such  as  Detroit,  Vincennes,  Kaskaskia, 
Prairie  du  Chien,  Mackinac,  and  Green  Bay,  besides  the  humble 
beginnings  of  Ehnira  and  Binghampton,  in  New  York,  which, 
even  at  that  time,  lay  outside  the  body  of  continuous  settlement. 

Following  the  line  which  limits  this  great  body  of  settlement  in 
all  its  undulations,  we  find  its  length  to  be  3,200  miles.  In  this 
measurement  no  account  has  been  made  of  slight  irregularities, 
such  as  those  in  the  ordinary  meanderings  of  a  river  which  forms 
the  boundary  line  of  population ;  but  we  have  traced  all  the  ins 
and  outs  of  this  frontier  line,  which  seem  to  indicate  a  distinct 
change  in  the  settlement  of  the  country  for  any  cause,  whether  of 
progression  or  of  retrogression.  The  area  of  settlement,  thus,  is  the 
area  embraced  between  the  frontier  line  and  the  coast,  diminished 
by  such  unsettled  areas  as  may  lie  within  it,  and  increased  by 
such  as  lie  without  it.  These  are  not  susceptible  of  very  accurate 
determination,  owing  to  the  fact  that  our  best  maps  are,  to  a  cer- 
tain extent,  incorrect  in  boundaries  and  areas ;  but  all  the  accu- 
racy required  for  our  present  purpose  can  be  secured.  The 
settled  area  of  1790,  as  indicated  by  the  line  traced,  is  226,085 
square  miles.  The  entire  body  of  continuously  settled  area  lay 
between  31°  and  45°  north  latitude  and  67°  and  83°  west 
longitude. 

Outside  of  this  body  of  continuous  settlement  are  the  smaller 
areas  mentioned  above,  which,  added  to  the  main  body  of  settled 
area,  give  as  a  total  239,935  square  miles,  the  aggregate  popu- 
lation being  3,929,214,  and  the  average  density  of  settlement  16.4 
to  the  square  mile. 

In  1790  the  District  of  Maine  belonged  to  Massachusetts. 
Georgia  comprised  not  only  the  present  State  of  that  name,  but 
nearly  all  of  what  are  now  the  States  of  Alabama  and  Mississippi. 
The  States  of  Kentucky  and  Tennessee  were  then  known  as  the 
"Territory  south  of  the  Ohio  river,"  and  the  present  States  of 
Ohio,  Indiana,  Illinois,  Michigan,  Wisconsin,  and  part  of  Minne- 
sota, as  the  "  Territory  northwest  of  the  Ohio  river."  Spain 
claimed  possession  of  what  is  now  Florida,  with  a  strip  along  the 


U.    S.    POPULATION,    I800.  289 

southern  border  of  Alabama,  Mississippi,  and  all  of  the  region 
west  of  the  Mississippi  river. 

An  inspection  of  the  maps  relating  to  the  earlier  census  years 
will  show  that  the  progress  of  population  westward  across  the 
Appalachian  system  has  taken  place,  in  the  main,  along  four 
lines.  The  northernmost  of  these,  which  was  the  first  to  be  de- 
veloped, runs  through  Central  New  York,  following  up,  gen- 
erally, the  Mohawk  river.  This  line  has,  throughout  our  history, 
been  one  of  the  principal  courses 'of  population  in  its  westward 
flow.  The  second  crosses  Southern  Pennsylvania,  Western  Mary- 
land, and  Northern  Virginia,  parallel  to  and  along  the  course  of 
the  Upper  Potomac.  The  third  runs  through  Virginia,  passing 
southwestward  down  the  great  Appalachian  valley,  crossing 
thence  over  into  Kentucky  and  Tennessee.  South  of  this,  the 
principal  movement  westward  has  been  around  the  end  of  the 
Appalachian  chain,  through  Georgia  and  Alabama. 


At  the  Second  Census,  that  of  1800,  the  frontier  line,  as  it  ap- 
pears on  the  map,  has  been  rectified,  so  that  while  it  embraces 
282,208  square  miles,  it  describes  a  course,  when  measured  in 
the  same  manner  as  that  of  i79°i  °f  °n^V  2,800  lineal  miles. 
The  advancement  of  this  line  has  taken  place  in  every  direction, 
though  in  some  parts  of  the  country  much  more  markedly  than 
in  others. 

In  Maine  and  New  Hampshire  there  is  apparent  only  a  slight 
northward  movement  of  settlement ;  in  Vermont,  on  the  other 
hand,  while  the  settled  area  has  not  decidedly  increased,  its 
density  has  become  greater.  Massachusetts  shows  but  little 
change,  but  in  Connecticut  the  settlements  along  the  lower 
course  of  the  Connecticut  river  have  appreciably  increased. 

In  New  York  settlement  has  poured  up  the  Hudson  to  the 
mouth  of  the  Mohawk,  and  thence,  through  the  great  natural 
roadway,  westward.  The  narrow  tongue  which  before  ex- 
tended out  beyond  the  middle  of  the  State  has  now  widened  until 
it  spreads  from  the  southern  border  of  the  State  to  lake  Ontario. 
A  narrow  belt  of  settlement  even  stretches  down  the  St.  Law- 
rence, and  along  all  the  northern  border  of  the  State,  to  Lake 
Champlain,  completely  sourrouncling  what  may  be  characteristi- 
cally defined  as  the  Adirondack  region. 


290  SELECTIONS. 

In  Pennsylvania  settlements  have  extended  up  the  Susquehanna 
and  joined  the  New  York  groups,  leaving,  as  yet,  an  unsettled 
space  in  the  north-east  corner  of  the  State,  which  comprises  a 
body  of  rugged  mountain  country.  With  the  exception  of  a  little 
strip  along  the  western  border  of  Pennsylvania,  the  northern  part 
of  the  State,  west  of  the  Susquehanna,  is  as  yet  entirely  without 
inhabitants.  Population  has  streamed  across  the  southern  half  of 
the  State,  and  settled  in  a  dense  body  about  the  forks  of  the  Ohio 
river,  at  the  present  site  of 'Pittsburgh,  and  thence  extended 
slightly  into  the  State  of  Ohio. 

In  Virginia  wo  note  but  little  change,  although  there  is  a 
general  extension  of  settlement,  with  an  increase  in  density, 
especially  along  the  coast.  North  Carolina  is  now  almost  en- 
tirely covered  with  population ;  the  mountain  region  has, 
generally  speaking,  been  nearly  all  reclaimed  to  the  service  of 
man.  In  South  Carolina  there  is  a  general  increase  in  density  of 
settlement,  while  the  southwestern  border  has  been  carried  down, 
until  now  the  Altamaha  river  is  its  limit.  The  incipient  settle- 
ments in  Northern  Kentucky  have  spread  southward  across  the 
State,  and  even  into  Tennessee,  forming  a  junction  with  the  little 
settlement,  noted  at  the  date  of  the  last  census,  on  the  Cumber- 
land river.  The  group  thus  formed  has  extended  down  the  Ohio, 
nearly  to  its  junction  with  the  Tennessee  and  the  Cumberland, 
and  across  the  Ohio  river  into  the  present  State  of  Ohio,  where 
we  note  the  beginning  of  Cincinnati.  Other  infant  settlements 
appear  at  this  date.  On  the  east  side  of  the  Mississippi  river,  in 
the  present  State  of  Mississippi,  is  a  strip  of  settlement  along  the 
bluffs  below  the  Yazoo  bottom.  Besides  the  settlement  on  the 
present  site  of  St.  Louis,  not  at  this  time  within  the  United 
States,  is  an  adjacent  settlement  in  what  is  now  Illinois,  while  all 
the  pioneer  settlements  previously  noted  have  grown  to  a  greater 
or  less  extent. 

From  the  region  embraced  between  the  frontier  line  and  the 
Atlantic  must  be  deducted  the  Adirondack  tract,  in  Northern 
New  York,  and  the  unsettled  region  in  Northern  Pennsylvania, 
already  referred  to ;  so  that  the  actual  area  of  settlement, 
bounded  by  a  continuous  line,  is  to  be  taken  at  271,908  square 
miles.  All  this  lies  between  30°  45'  and  45°  15'  north  latitude, 
and  67°  and  88°  west  longitude. 

To  this  should  be  added  the  aggregate  extent  of  all  settlements 
lying  outside  of  the  frontier  line,  which  collectively  amount  to 


U.    S.    POPULATION,    1 8 10.  29 1 

33,800  square  miles,  making  a  total  area  of  settlement  of  305,- 
708  square  miles.  As  the  aggregate  population  is  5,308,483,  the 
average  density  of  settlement  is  17.4. 

The  infant  settlements  of  this  period  have  been  much  retarded 
at  many  points  by  the  opposition  of  the  Indian  tribes ;  but  in  the 
neighborhood  of  the  more  densely  settled  portions  of  the  northern 
part  of  the  country  these  obstacles  have  been  of  less  magnitude 
than  farther  south.  In  Georgia,  especially,  the  large  and  power- 
ful tribes  of  Creeks  and  Cherokees  have  stubbornly  opposed  the 
progress  of  population. 

During  the  decade  just  past  Vermont,  formed  from  a  part  of  New 
York,  has  been  admitted  to  the  Union ;  also  Kentucky  and 
Tennessee,  formed  from  the  "  Territory  south  of  the  river  Ohio  ;  " 
Mississippi  Territory,  having,  however,  very  different  boundaries 
from  the  present  State  of  that  name,  has  been  organized  ;  while 
the  "  Territory  northwest  of  the  river  Ohio"  has  been  divided 
and  Indiana  Territory  organized  from  the  western  portion. 


18 1O. 

At  1810  we  note  great  changes,  especially  the  extension  of  the 
sparse  settlements  of  the  interior.  The  hills  of  Western  New 
York  have  become  almost  entirely  covered  with  population, 
which  has  spread  along  the  south  shore  of  Lake  Erie  well  over 
into  Ohio,  and  has  effected  a  junction  with  the  previously  existing 
body  of  population  about  the  forks  of  the  Ohio  river,  leaving  un- 
settled an  included  heart-shaped  area  in  Northern  Pennsylvania, 
which  comprises  the  rugged  country  of  the  Appalachian  plateau. 
The  occupation  of  the  Ohio  river  has  now  become  complete, 
from  its  head  to  its  mouth,  with  the  exception  of  small  gaps  be- 
low the  mouth  of  the  Tennessee.  Spreading  in  every  direction 
from  the  "  dark  and  bloody  ground"  of  Kentucky,  settlement 
covers  almost  the  entire  State,  while  the  southern  border  line  has 
been  extended  to  the  Tennessee  river,  in  Northern  Alabama.  In 
Georgia  settlements  are  still  held  back  by  the  Creek  and  the 
Cherokee  Indians,  although  in  1802  a  treaty  with  the  former  tribe 
relieved  the  southwestern  portion  of  the  State  of  their  presence, 
and  left  the  ground  open  for  occupancy  by  the  whites.  In  Ohio 
settlements,  starting  from  the  Ohio  river  and  from  southwestern 
Pennsylvania,  have  worked  northward  and  westward,  until  they 
cover  two-thirds  of  the  area  of  the  State.  Michigan  and  Indiana 


292  SELECTIONS. 

are  still  virgin  territory,  with  the  exception  of  a  little  strip  about 
Detroit,  in  the  former  State,  and  a  small  area  in  the  southwestern 
part  of  the  latter.  St.  Louis,  from  a  fur-trading  post,  has  become 
an  important  centre  of  settlement,  population  having  spread 
northward  above  the  mouth  of  the  Missouri  and  southward  along 
the  Mississippi  to  the  mouth  of  the  Ohio.  At  the  mouth  of  the 
Arkansas,  in  what  is  now  the  State  of  Arkansas,  is  a  similar 
body  of  settlement.  The  transfer  of  the  Territory  of  Louisiana 
to  our  jurisdiction,  which  was  effected  in  1803,  has  brought  into 
the  country  a  large  body  of  population,  which  stretches  along  the 
Mississippi  river  from  its  mouth  nearly  up  to  the  present  north- 
ern limit  of  the  State  of  Louisiana,  up  the  Red  river  and  the  St. 
Francis,  in  general  occupying  the  alluvial  regions.  The  incipient 
settlements  noted  on  the  last  map  in  Mississippi  have  effected  a 
junction  with  those  of  Louisiana,  while  in  Lower  Alabama  and 
Mississippi  a  similar  patch  appears  upon  the  Mobile  and  the  Pearl 
riverSi 

In  this  decade  large  additions  have  been  made  to  the  territory 
of  the  United  States,  and  many  changes  have  been  effected  in  the 
lines  of  interior  division.  The  purchase  of  Louisiana  has  added 
1,124,685  square  miles,  an  empire  in  itself,  to  the  United  States, 
and  has  given  to  us  absolute  control  of  the  Mississippi  and  its 
navigable  branches.  Georgia,  during  the  same  period,  has  ceded 
to  the  United  States  the  portion  of  its  territory  which  now  con- 
stitutes the  larger  part  of  the  States  of  Alabama  and  Mississippi. 
The  State  of  Ohio  has  been  formed  from  a  portion  of  what  pre- 
viously was  known  as  the  "  Territory  north  of  the  Ohio  river." 
Michigan  Territoiy  has  been  erected,  comprising  what  is  now  the 
lower  peninsula  of  Michigan  ;  Indiana  Territory  has  been  re- 
stricted to  the  present  limits  of  the  State  of  that  name;  Illinois 
Territory  comprises  all  of  the  present  State  of  Illinois,  with  that  of 
Wisconsin,  and  a  part  of  Minnesota ;  while  from  the  Louisiana 
purchase  has  been  carved,  under  the  name  of  the  "  Territory  of 
Orleans,"  all  that  part  of  the  present  State  of  Louisiana  which 
lies  west  of  the  Mississippi  river,  the  remainder  of  the  great  ter- 
ritory so  cheaply  acquired  from  France  being  known  by  the  name 
of  the  "  Louisiana  Territory." 

At  this  date  the  frontier  line  is  2,900  miles  long,  and  includes 
between  itself  and  the  Atlantic  408,895  square  miles.  From  this 
must  be  deducted  several  large  areas  of  unsettled  land  :  first,  the 
area  in  Northern  New  York,  now  somewhat  smaller  than  ten 


U.    S.    POPULATION,    I82O.  293 

years  before,  but  still  by  no  means  inconsiderable  in  extent ; 
second,  the  heart-shaped  area  in  Northwestern  Pennsylvania,  em- 
bracing part  of  the  Allegheny  plateau,  in  size  about  equal  to  the 
unsettled  area  in  New  York  ;  third,  a  strip  along  the  central  part 
of  what  is  now  West  Virginia,  extending  from  the  Potomac  south- 
ward, taking  in  what  is  now  a  part  of  Eastern  Kentucky  and 
Southwestern  Virginia,  and  extending  nearly  to  the  border  line  of 
Tennessee  ;  fourth,  a  comparatively  small  area  in  Northern  Ten- 
nessee, upon  the  Cumberland  plateau.  These  tracts  together 
comprise  26,050  square  miles,  making  the  actual  area  of  settlement 
included  within  the  frontier  line  382,845  square  miles.  All  this 
lies  between  latitude  29°  30'  and  45°  15'  north,  and  between  the 
meridians  of  67°  and  88°  30'  west. 

Beyond  the  frontier  there  are,  in  addition  to  the  steadily  in- 
creasing number  of  outposts  and  minor  settlements,  several  con- 
siderable bodies  of  population,  which  have  been  above  noted. 
The  aggregate  extent  of  these,  and  of  the  numerous  small  patches 
of  population  scattered  over  the  West  and  South,  may  be  estimated 
at  25,100  square  miles,  making  the  total  area  of  settlement  in 
1810,  407,945  square  miles;  the  aggregate  population  being 
7,239,881,  and  the  average  density  of  settlement  17.7  to  the 
square  mile. 

Between  1800  and  1810  the  principal  territorial  changes  have 
been  as  follows :  Ohio  has  been  admitted,  and  the  Territories  of 
Illinois  and  Michigan  have  been  formed  from  parts  of  Indiana 
Territory. 


The  decade  from  1810  to  1820  has  witnessed  several  territorial 
changes.  Florida  at  this  date  (1820)  is  a  blank  upon  the  map. 
The  treaty  with  Spain,  which  gives  her  to  us,  is  signed,  but  the 
delivery  has  not  yet  taken  place.  Alabama  and  Mississippi, 
made  from  the  Mississippi  Territory,  have  been  organized  and  ad- 
mitted as  States.  Indiana  and  Illinois  appear  as  States,  with  their 
present  limits.  The  Territory  of  Louisiana  has  been  admitted  as 
a  State.  The  District  of  Maine  has  also  been  erected  into  a  State. 
Arkansas  Territory  has  been  cut  from  the  southern  portion  of  the 
Territory  of  Louisiana.  The  Indian  Territory  has  been  constituted 
to  serve  as  a  reservation  for  the  Indian  tribes.  Michigan  Ter- 
ritory has  been  extended  to  include  all  of  the  present  States  of 
Michigan,  Wisconsin,  ancl  part  of  Minnesota.  That  part  of  the 


294  SELECTIONS. 

old  Louisiana  Territory  remaining,  after  cutting  out  Arkansas  and 
Indian  Territory,  has  received  the  name  of  "  Missouri  Territory." 

Again,  in  1820,  we  note  a  great  change  in  regard  to  the  fron- 
tier line.  It  has  become  vastly  more  involved  and  complex,  ex- 
tending from  Southeastern  Michigan,  on  lake  St.  Clair,  south- 
westward  into  what  is  now  Missouri  ;  thence,  making  a  great 
semicircle  to  the  eastward,  it  sweeps  west  again  around  a  body 
of  population  in  Louisiana,  and  ends  on  the  Gulf  coast  in  that 
State.  The  area  included  by  it  has  immensely  increased,  but 
much  of  this  increase  is  balanced  by  the  great  extent  of  unsettled 
land  included  within  it. 

Taking  tip  the  changes  in  detail,  we  note,  first,  the  great  in- 
crease in  the  population  of  Central  New  York,  a  belt  of  increased 
settlement  having  swept  up  the  Mohawk  valley  to  Lake  Ontario, 
and  along  its  shore  nearly  to  the  Niagara  river.  A  similar  in- 
crease is  seen  about  the  forks  of  the  Ohio  river,  while  in  North- 
ern Pennsylvania  the  unsettled  region  on  the  Appalachian  plateau 
has  sensibly  decreased  in  size.  The  unsettled  area  in  Western 
Virginia  and  Eastern  Kentucky  has  very  greatly  diminished, 
population  having  extended  almost  entirely  over  the  Allegheny 
region  in  these  States.  The  little  settlements  about  Detroit  have 
extended  and  spread  along  the  shore  of  Lake  Erie,  until  they  have 
joined  those  in  Ohio.  The  frontier  line  in  Ohio  has  crept  north- 
ward and  westward,  leaving  only  the  northwestern  corner  of  the 
State  unoccupied.  Population  has  spread  northward  from  Ken- 
tucky and  westward  from  Ohio  into  Southern  Indiana,  covering 
sparsely  the  lower  third  of  that  State.  The  groups  of  population 
around  St.  Louis,  which  at  the  time  of  the  previous  census  were 
enjoying  a  rapid  growth,  have  extended  widely,  making  a  junc- 
tion with  the  settlements  of  Kentucky  and  Tennessee,  along  a 
broad  belt  in  Southern  Illinois  ;  following  the  main  watercourses, 
population  has  gone  many  scores  of  miles  up  the  Mississippi  and 
the  Missouri  rivers.  The  settlements  in  Alabama,  which  up  to 
this  time  had  been  very  much  retarded  by  the  Creeks,  were 
rapidly  reenforced  and  extended,  in  consequence  of  the  victory  of 
General  Jackson  over  this  tribe  and  the  subsequent  cession  of 
portions  of  this  territory.  Immigration  to  Alabama  has  already 
become  considerable,  and  in  a  short  time  the  whole  central  portion 
of  the  State,  embracing  a  large  part  of  the  region  drained  by  the 
Mobile  river  and  its  branches,  will  be  covered  bv  settlements,  to 
extend  northward  and  effect  a  junction  with  the  Kentucky  and 


U.    S.    POPULATION,    1830.  295 

Tennessee  settlements,  and  westward  across  the  lower  part  of 
Mississippi,  until  they  meet  the  Louisiana  settlements.  In 
Georgia  the  Cherokees  and  the  Creeks  still  hold  settlement  back 
along  the  line  of  the  Altamaha  river.  There  are,  however, 
scattered  bodies  of  population  in  various  parts  of  the  State, 
though  of  small  extent.  In  Louisiana  we  note  a  gradual  in- 
crease of  the  extent  of  redeemed  territory,  which  appears  to  have 
been  limited  almost  exactly  by  the  borders  of  the  alluvial  region. 
In  Arkansas  the  settlements,  which  we  saw  at  1810  at  the  mouth 
of  the  Arkansas  river,  have  extended  up  the  bottom  lands  of  that 
river  and  of  the  Mississippi,  forming  a  body  of  population  of 
considerable  size.  Besides  these,  a  small  body  is  found  in  the 
southern  central  part  of  the  State,  at  the  southeastern  base  of  the 
hill  region,  and  another  in  the  prairie  region  in  the  northern  part. 
The  frontier  line  now  has  a  length  of  4,100  miles,  embracing 
an  area,  after  taking  out  alt  the  unsettled  regions  included  be- 
tween it,  the  Atlantic,  and  the  Gulf,  of  504,517  square  miles,  all 
lying  between  29°  30'  and  45°  30'  north  latitude,  and  between  67° 
and  93°  45'  west  longitude.  Outside  the  frontier  line  are  some 
bodies  of  population  on  the  Arkansas,  White,  and  Washita 
rivers,  in  Arkansas,  as  before  noted,  as  well  as  some  small  bodies 
in  the  Northwest.  Computing  these  at  4,200  square  miles  in  the 
aggregate,  we  have  a  total  settled  area  of  508,717  square  miles; 
the  aggregate  population  being  9,633, 822,  and  the  average  density 
of  settlement  18.9  to  the  square  mile. 


In  the  decade  from  1820  to  1830  other  territorial  changes  have 
occurred.  In  the  early  part  of  the  decade  the  final  transfer  of 
Florida  and  Spanish  jurisdiction  was  effected,  and  it  became  a 
Territory  of  the  United  States.  Missouri  has  been  carved  from 
the  southeastern  part  of  the  old  Missouri  Territory,  and  admitted 
as  a  State.  Otherwise  the  States  and  Territories  have  remained 
nearly  as  before.  Settlement  during  the  decade  has  again  spread 
greatly.  The  westward  .extension  of  the  frontier  does  not  appear 
to  have  been  so  great  as  in  some  former  periods,  the  energies  of 
the  people  being  mainly  given  to  filling  up  the  included  areas. 
In  other  words,  the  decade  from  1810  to  1820  seems  to  have  been 
one  rather  of  blocking  out  work  which  the  succeeding  decade  has 
been  largely  occupied  in  completing. 


296  SELECTIONS. 

During  this  period  the  Indians,  especially  in  the  South,  have 
still  delayed  settlement  to  a  great  extent.  The  Creeks  and  the 
Cherokees  in  Georgia  and  Alabama,  and  the  Choctaws  and  the 
Chickasaws  in  Mississippi,  occupy  large  areas  of  the  best  por- 
tions of  those  States,  and  successfully  resist  encroachment  upon 
their  territory.  Georgia,  however,  has  witnessed  a  large  increase 
in  settlement  during  the  decade.  The  settlements  which  have 
heretofore  been  staid  on  the  line  of  the  Altamaha  spread  west- 
ward across  the  central  portion  of  the  State  to  its  western  boun- 
dary, where  they  have  struck  against  the  barrier  of  the  Creek 
territory.  Stopped  at  this  point,  they  have  moved  southward 
down  into  the  southwest  corner,  and  over  into  Florida,  extending 
even  to  the  Gulf  coast.  Westward  they  have  stretched  across  the 
southern  part  of  Alabama,  and  joined  that  body  of  settlement 
which  was  previously  formed  in  the  drainage-basin  of  the  Mobile 
river.  The  Louisiana  settlements  have  but  slightly  increased, 
and  no  great  change  appears  to  have  taken  place  in  Mississippi, 
owing  largely  to  the  cause  above  noted,  viz.,  the  occupancy  of  the 
soil  by  Indians.  In  Arkansas  the  spread  of  settlement  has  been 
in  a  strange  and  fragmentary  way.  A  line  reaches  from  Louisi- 
ana up  the  Arkansas  river  to  the  State  line,  where  it.  is  stopped 
abruptly  by  the  boundary  of  the  Indian  Territory.  It  extends  up 
the  Mississippi,  and  joins  the  great  body  of  population  in  Ten- 
nessee. A  branch  extends  northeastward  from  near  Little  Rock 
to  the  northern  portion  of  the  State.  All  these  settlements  within 
Arkansas  Territory  are  as  yet  very  sparse.  In  Missouri  the  prin- 
cipal extension  of  settlement  has  been  in  a  broad  belt  up  the 
Missouri  river,  reaching  to  the  present  site  of  Kansas  City,  at  the 
mouth  of  the  Kansas  river,  where  quite  a  dense  body  of  population 
appears.  Settlement  has  progressed  in  Illinois,  from  the  Missis- 
sippi river  eastward  and  northward,  covering  more  than  half  the 
State.  In  Indiana  it  has  followed  up  the  Wabash  river,  and 
thence  has  spread  until  it  reaches  nearly  to  the  north  line  of  the 
State.  But  little  of  Ohio  remains  unsettled.  The  sparse  settle- 
ments about  Detroit,  in  Michigan  Territory,  have  broadened  out, 
extending  into  the  interior  of  the  State,  while  isolated  patches 
have  appeared  in  various  other  localities. 

Turning  to  the  more  densely  settled  parts  of  the  country,  we 
find  that  settlement  is  slowly  making  its  way  northward  in  Maine, 
although  discouraged  by  the  poverty  of  the  soil  and  the  severity 
of  the  climate.  The  unsettled  tract  in  Northern  New  York  is 


U.    S.    POPULATION,    1840.  297 

decreasing,  but  very  slowly,  as  is  also  the  case  with  the  unsettled 
area  in  Northern  Pennsylvania.  In  Western  Virginia  the  unsettled 
tracts  are  reduced  to  almost  nothing,  while  the  vacant  region  in 
Eastern  Tennessee,  on  the  Cumberland  plateau,  is  rapidly  dimin- 
ishing. 

At  this  date,  1830,  the  frontier  line  has  a  length  of  5,300  miles, 
and  the  aggregate  area  now  embraced  between  the  ocean,  the 
Gulf,  and  the  frontier  line  is  725,406  square  miles.  Of  this,  how- 
ever, not  less  than  97^389  square  miles  are  comprised  within  the 
included  vacant  tracts,  leaving  only  628,017  square  miles  as  the 
settled  area  within  the  frontier  line,  all  of  which  lies  between 
latitude  29°  15'  and  46°  15'  north,  and  between  longitude  67°  and 
95°  west. 

Outside  the  body  of  continuous  settlement  are  no  longer  found 
large  groups,  but  several  small  patches  of  population  appear  in 
Ohio,  Indiana,  Illinois,  Michigan,  and  Wisconsin,  aggregating 
4,700  square  miles,  making  a  total  settled  area,  in  1830,  of  632,- 
717  square  miles.  As  the  aggi'egate  population  is  12,866,020,  the 
average  density  of  settlement  is  20.3  to  the  square  mile. 


1840. 

During  the  decade  ending  in  1840  the  State  of  Michigan  has 
been  created  with  its  present  limits,  the  remainder  of  the  old  ter- 
ritory being  known  as  Wisconsin  Territory.  Iowa  Territory  has 
been  created  from  a  portion  of  Missouri  Territory,  embracing  the 
present  State  of  Iowa  and  the  western  part  of  Minnesota,  and 
Arkansas  has  been  admitted  to  the  Union. 

In  1840  we  find,  by  examining  the  map  of  population,  that  the 
process  of  filling  up  and  completing  the  work  blocked  out  be- 
tween 1810  and  1820  has  been  carried  still  farther.  From  Geor- 
gia, Alabama,  and  Mississippi  the  Cherokee,  Creek,  Choctaw, 
and  Chickasaw  Indians,  who,  at  the  time  of  the  previous  census, 
occupied  large  areas  in  these  States,  and  formed  a  very  serious 
obstacle  to  settlement,  have  been  removed  to  the  Indian  Territory, 
and  their  country  has  been  opened  up  to  settlement.  Within  the 
two  or  three  years  which  have  elapsed  since  the  removal  of  these 
Indians  the  lands  relinquished  by  them  have  been  entirely  taken 
up,  and  the  country  has  been  covered  with  a  comparatively  dense 
settlement.  In  Northern  Illinois,  the  Sac  and  Fox  and  Pottawo- 
tomie  tribes  having  been  removed  to  the  Indian  Territory,  their 


298  SELECTIONS. 

country  has  been  promptly  taken  up,  and  we  find  now  settlements 
carried  over  the  whole  extent  of  Indiana,  Illinois,  and  across 
Michigan  and  Wisconsin  as  far  north  as  the  forty-third  parallel. 
Population  ha*s  crossed  the  Mississippi  river  into  Iowa  Territory, 
and  occupies  a  broad  belt  up  and  down  that  stream.  In  Missouri  the 
settlements  have  spread  northward  from  the  Missouri  river  nearly 
to  the  boundary  of  the  State,  and  southward  till  they  cover  most 
of  the  southern  portion,  and  make  connection  in  two  places  with 
the  settlements  of  Arkansas.  The  unsettled  area  found  in  South- 
ern Missouri,  together  with  that  in  Northwestern  Arkansas,  is  due 
to  the  hilly  and  rugged  nature  of  the  country,  and  to  the  poverty 
of  the  soil,  as  compared  with  the  rich  prairie  lands  all  around.  In 
Arkansas  the  settlements  remain  sparse,  and  have  spread  widely 
away  from  the  streams,  covering  much  of  the  prairie  parts  of  the 
State.  There  is,  besides  the  area  in  Northwestern  Arkansas  just 
mentioned,  a  large  area  in  the  northeastern  part  of  the  State,  com- 
prised almost  entirely  within  the  alluvial  regions  of  the  St.  Fran- 
cis river,  and  also  one  in  the  southern  portion,  extending  over 
into  Northern  Louisiana,  which  is  entirely  in  the  fertile  prairie 
section.  The  fourth  unsettled  region  lies  in  the  southwest  part  of 
the  State. 

In  the  older  States  we  note  a  gradual  decrease  in  the  unsettled 
areas,  as  in  Maine  and  in  New  York.  In  Northern  Pennsylvania  the 
unsettled  section  has  entirely  disappeared.  A  small  portion  of  the 
unsettled  patch  on  the  Cumberland  plateau  still  remains.  In  south- 
ern Georgia  the  Okeefenokee  swamp  and  the  pine  barrens  adja- 
cent have  thus  far  repelled  settlement,  although  population  has 
increased  in  Florida,  passing  entirely  around  this  area  to  the  south. 
The  greater  part  of  Florida,  however,  including  nearly  all  the 
peninsula  and  several  large  areas  along  the  Gulf  coast,  still  re- 
mains without  settlement.  This  is  doubtless  due,  in  part,  to  the 
nature  of  the  country,  being  alternately  swamp'  and  hummock, 
and  in  part  to  the  hostility  of  the  Seminole  Indians,  who  still 
occupy  nearly  all  of  the  peninsula. 

The  frontier  line  in  1840  has  a  length  of  3,300  miles.  This 
shrinking  in  its  length  is  due  to  its  rectification  on  the  northwest 
and  southwest,  owing  to  the  filling  out  of  the  entire  interior.  It 
encloses  an  area  of  900,658  square  miles,  all  lying  between  latitude 
29°  and  46°  30'  north,  and  longitude  67°  and  95°  30'  west.  The 
vacant  tracts  have,  as  noted  above,  decreased,  although  they  are 
still  quite  considerable  in  Missouri  and  Arkansas.  The  total  area 


U.   S.    POPULATION,    1850.  299 

of  the  vacant  tracts  is  95,516  square  miles.  The  settled  area  out- 
side the  frontier  line  is  notably  small,  and  amounts,  in  the  aggre- 
gate, to  only  2,150  miles,  making  the  entire  settled  area  807,292 
square  miles  in  1840.  The  aggregate  population  being  17,069,- 
453,  the  average  density  is  21.1  to  the  square  mile. 


185O. 

Between  1840  and  1850  the  limits  of  our  country  have  been 
further  extended  by  the  annexation  of  the  State  of  Texas  and  of 
territory  acquired  from  Mexico  by  the  treaty  of  Guadalupe 
Hidalgo.  The  States  of  Iowa,  Wisconsin,  and  Florida  have  been 
admitted  to  the  Union,  and  the  Territories  of  Minnesota,  Oregon, 
and  New  Mexico  have  been  created.  An  examination  of  the 
maps  shows  that  the  frontier  line  has  changed  very  little  during 
this  decade.  At  the  western  border  of  Arkansas  the  extension  of 
settlement  is  peremptorily  limited  by  the  boundary  of  the  Indian 
Territory ;  but,  curiously  enough  also,  the  western  boundary  of 
Missouri  puts  almost  a  complete  stop  to  all  settlement,  notwith- 
standing that  some  of  the  most  densely  populated  portions  of  the 
State  lie  directly  on  that  boundary. 

In  Iowa  settlements  have  made  some  advance,  moving  up  the 
Missouri,  the  Des  Moines,  and  other  rivers.  The  settlements  in 
Minnesota  at  and  about  St.  Paul,  which  appeared  in  1840,  are 
greatly  extended  up  and  down  the  Mississippi  river,  while  other 
scattering  bodies  of  population  appear  in  Northern  Wisconsin.  In 
the  southern  part  of  the  State  settlement  has  made  considerable 
advance,  especially  in  a  northeastern  direction,  towards  Green 
Bay.  In  Michigan  the  change  has  been  very  slight. 

Turning  to  the  southwest  we  find  Texas,  for  the  first  time  on 
the  map  of  the  United  States,  with  a  considerable  extent  of  settle- 
ment ;  in  general,  however,  it  is  very  sparse,  most  of  it  lying  in 
the  eastern  part  of  the  State,  and  being  largely  dependent  upon 
the  grazing  industry. 

The  included  unsettled  areas  now  are  very  small  and  few  in 
number.  There  still  remains  one  in  Southern  Missouri,  in  the 
hilly  country;  a  small  one  in  Northeastern  Arkansas,  in  the 
swampy  and  alluvial  region  ;  and  one  in  the  similar  country  in 
the  Yazoo  bottom-lands.  Along  the  coast  of  Florida  are  found 
two  patches  of  considerable  size,  which  are  confined  to  the 
swampy  coast  regions.  The  same  is  the  case  along  the  coast  of 


3OO  SELECTIONS. 

Louisiana.  The  sparse  settlements  of  Texas  are  also  interspersed 
with  several  patches  devoid  of  settlement.  In  Southern  Georgia 
the  large  vacant  space  heretofore  noted,  extending  also  into  North- 
ern Florida,  has  entirely  disappeared,  and  the  Florida  settlements 
have  already  reached  southward  to  a  considerable  distance  in  the 
peninsula,  being  now  free  to  extend  without  fear  of  hostile  Semi- 
noles,  the  greater  part  of  whom  have  been  removed  to  the  Indian 
Territory. 

The  frontier  line,  which  now  extends  around  a  considerable 
part  of  Texas  and  issues  on  the  Gulf  coast  at  the  mouth  of  the 
Nueces  river,  is  4,500  miles  in  length.  The  aggregate  area  in- 
cluded by  it  is  1,005,213  square  miles,  from  which  deduction  is  to 
be  made  for  vacant  spaces,  in  all,  64,339  square  miles.  The  iso- 
lated settlements  lying  outside  this  body  in  the  western  part  of  the 
country  amount  to  4,775  square  miles. 

But  it  is  no  longer  by  a  line  drawn  around  from  the  St.  Croix 
river  to  the  Gulf  of  Mexico  that  we  embrace  all  the  population  of 
the  United  States,  excepting  only  a  few  outlying  posts  and  small 
settlements.  We  may  now,  from  the  Pacific,  run  a  line  around 
80,000  miners  and  adventurers,  the  pioneers  of  more  than  one 
State  of  the  Union  soon  to  arise  on  that  coast.  This  body  of  set- 
tlement has  been  formed,  in  the  main,  since  the  acquisition  of  the 
territory  by  the  United  States,  and,  it  might  even  be  said,  within 
the  last  year  (1849-50),  dating  from  the  discovery  of  gold  in 
California.  These  settlements  maybe  computed  rudely  at  33.600 
square  miles,  making  a  total  area  of  settlement  at  that  date  of 
979,249  square  miles,  the  aggregate  population  being  23,191,876, 
and  the  average  density  of  settlement  23.7  to  the  square  mile. 


Between  1850  and  1860  the  territorial  changes  noted  are  as  fol- 
lows :  The  strip  of  Arizona  and  New  Mexico  south  of  the  Gila 
river  has  been  acquired  from  Mexico  by  the  Gadsden  purchase 
(1853)  ;  Minnesota  Territory  has  been  admitted  as  a  State  ;  Kan- 
sas and  Nebraska  Territories  have  been  formed  from  parts  of  Mis- 
souri Territory ;  California  and  Oregon  have  been  admitted  as 
States,  while,  in  the  unsettled  parts  of  the  Cordilleran  region,  two 
new  territories  (Utah  and  Washington)  have  been  formed  out 
of  parts  of  that  terra  incognita  which  we  bought  from  France  as 
a  part  of  Louisiana,  and  of  that  which  we  acquired  by  conquest 


U.    S.    POPULATION,    i860.  3OI 

from  Mexico.  At  this  date  we  note  the  first  extension  of  settle- 
ments beyond  the  line  of  the  Missouri  river.  The  march  of  set- 
tlement up  the  slope  of  the  great  plains  has  begun.  In  Kansas 
and  Nebraska  population  is  now  found  beyond  the  97th  me- 
ridian. Texas  has  filled  up  even  more  rapidly,  its  extreme 
settlements  reaching  to  the  looth  meridian,  while  the  gaps 
noted  at  the  date  of  the  last  census  have  all  been  filled  by  popu- 
lation. The  incipient  settlements  about  St.  Paul,  in  Minnesota, 
have  grown  like  Jonah's  gourd,  spreading  in  all  directions,  and 
forming  a  broad  band  of  union  with  the  main  body  of  settlement 
down  the  line  of  the  Mississippi  river.  In  Iowa  settlements  have 
crept  steadily  northwestward  along  the  course  of  the  drainage, 
until  the  State  is  nearly  covered.  Following  up  the  Missouri, 
population  has  reached  out  into  the  southeastern  corner  of  the 
present  area  of  Dakota.  In  Wisconsin  the  settlements  have 
moved  at  least  one  degree  farther  north,  while  in  the  lower  penin- 
sula of  Michigan  they  have  spread  up  the  lake  shores,  nearly 
encircling  it  on  the  side  next  Lake  Michigan.  On  the  upper 
peninsula  the  little  settlements  which  appeared  in  1850  in  the 
copper  region  on  Keeweenaw  point  have  extended  and  increased 
greatly  in  density  as  that  mining  interest  has  developed  in  value. 
In  Northern  New  York  there  is  apparently  no  change  in  the  un- 
settled area.  In  Northern  Maine  we  note,  for  the  first  time,  a 
decided  movement  towards  the  settlement  of  its  unoccupied  ter- 
ritory, in  the  extension  of  the  settlements  on  its  eastern  and  north- 
ern border  up  the  St.  John  river.  The  unsettled  regions  in 
Southern  Missouri,  Northeastern  Arkansas,  and  Northwestern 
Mississippi  have  become  sparsely  covered  by  population.  Along 
the  Gulf  coast  there  is  little  or  no  change.  There  is  to  be  noted 
a  slight  extension  of  settlement  southward  in  the  peninsula  of 
Florida. 

The  frontier  line  now  measures  5,300  miles,  and  embraces 
1,126,518  square  miles,  lying  between  latitude  28°  30'  and  47°  30' 
north,  and  between  longitude  67°  and  99°  30'  west.  From  this 
deduction  should  be  made  on  account  of  vacant  spaces,  amount- 
ing to  39,139  square  miles,  found  mainly  in  New  York  and  along 
the  Gulf  coast.  The  outlying  settlements  beyond  the  xooth  me- 
ridian are  now  numerous.  They  include,  among  others,  a  strip 
extending  far  up  the  Rio  Grande  in  Texas,  embracing  7,475 
square  miles  (a  region  given  over  to  the  raising  of  sheep),  while 
the  Pacific  settlements,  now  comprising  one  sovereign  State,  are 


3<D2  SELECTIONS. 

nearly  three  times  as  extensive  as  at  1850,  embracing  99,900 
square  miles.  The  total  area  of  settlement  in  1860  is  thus 
1,194,754  square  miles;  the  aggregate  population  is  now 
31,443,321,  and  the  average  density  of  settlement  26.3  to  the 
square  mile. 


During  the  decade  from  1860  to  1870  a  number  of  territorial 
changes  have  been  effected  in  the  extreme  West.  Arizona, 
Colorado,  Dakota,  Idaho,  Montana,  Nevada,  and  Wyoming 
have  been  organized  as  Territories.  Kansas,  Nebraska,  and 
Nevada  have  been  admitted  as  States.  West  Virginia  has  been 
cut  off  from  the  mother  Commonwealth  and  made  a  separate 
State. 

In  1870  we  note  a  gradual  and  steady  extension  of  the  frontier 
line  westward  over  the  great  plains.  The  unsettled  areas  in 
Maine,  New  York,  and  Florida  have  not  greatly  diminished,  but 
in  Michigan  the  extension  of  the  lumber  interests  northward  and 
inward  from  the  Lake  Shore  has  reduced  considerably  the  unsettled 
portion.  On  the  upper  peninsula  the  settlements  have  increased 
somewhat,  owing  to  the  discovery  of  the  rich  iron  deposits 
destined  to  play  so  important  a  part  in  the  manufacturing  industry 
of  the  country. 

Settlement  has  spread  westward  to  the  boundary  of  the  State  in 
Southern  Minnesota,  and  up  the  Big  Sioux  river  in  Southeastern 
Dakota.  Iowa  is  entirely  reclaimed,  excepting  a  small  area  of 
perhaps  a  thousand  square  miles  in  its  northwestern  corner. 
Through  Kansas  and  Nebraska  the  frontier  line  has  moved 
steadily  westward,  following  in  general  the  courses  of  the  larger 
streams  and  of  the  newly  constructed  railroads.  The  frontier  in 
Texas  has  changed  but  little,  that  little  consisting  of  a  general 
westward  movement.  In  the  Cordilleran  region  settlements  have 
extended  but  slowly.  Those  upon  the  Pacific  coast  show  little 
change,  either  in  extent  or  in  density.  In  short,  we  see  every- 
where the  effects  of  the  war  in  the  partial  stoppage  of  the 
progress  of  development. 

The  settlements  in  the  West,  beyond  the  frontier  line,  have  ar- 
ranged themselves  mainly  in  three  belts.  The  most  eastern  of 
these  is  located  in  Central  Colorado,  New  Mexico,  and  Wyom- 
ing, along  the  eastern  base  of  and  among  the  Rocky  mountains. 
To  this  region  settlement  was  first  attracted  in  1859  anc* 


U.    S.   POPULATION,    iS/O.  303 

the  discovery  of  mineral  deposits,  and  has  been  retained  by  the 
richness  of  the  soil  and  by  the  abundance  of  water  for  irrigation, 
which  have  promoted  the  agricultural  industry. 

The  second  belt  of  settlement  is  that  of  Utah,  settled  in  1847  by 
the  Mormons  fleeing  from  Illinois.  This  community  then  dif- 
fered, and  still  differs,  radically  from  that  of  the  Rocky  moun- 
tains, being  essentially  agricultural,  mining  having  been  discoun- 
tenanced from  the  first  by  the  church  authorities,  as  tending  to  fill 
the  "Promised  Land"  with  Gentile  adventurers,  and  thereby  im- 
peril Mormon  institutions.  The  settlements  of  this  group,  as 
seen  on  the  map  for  1870,  extend  from  Southern  Idaho  southward 
through  Central  Utah,  and  along  the  eastern  base  of  the  Wahsatch 
range  into  Northern  Arizona.  They  consist  mainly  of  scattered 
hamlets  and  small  towns,  about  which  are  grouped  the  farms  of 
the  communities. 

The  third  strip  is  that  in  the  Pacific  States  and  Territories,  ex- 
tending from  Washington  Territory  southward  to  Southern  Cali- 
fornia and  eastward  to  the  system  of"  sinks,"  in  Western  Nevada. 
This  group  of  population  owes  its  existence  to  the  mining  in- 
dustry, the  moving  cause  in  nearly  all  westward  migrations. 
Originated  in  1849  by  a  "  stampede  "  the  like  of  which  the  world 
had  never  before  seen,  it  has  grown  by  successive  impulses  as 
new  fields  for  rapid  money-getting  have  been  developed.  Lat- 
terly, however,  the  value  of  this  region  to  the  agriculturist  has 
been  recognized,  and  the  character  of  the  occupations  of  the 
people  is  undergoing  a  marked  change. 

These  three  great  Western  groups  comprise  nine-tenths  of  the 
population  west  of  the  frontier  line.  The  remainder  is  scattered 
about  in  the  valleys  and  the  mountains  of  Montana,  Idaho,  and 
Arizona,  at  military  posts,  isolated  mining  camps,  and  on  cattle 
ranches. 

The  frontier  line  in  1870  embraces  1,178,068  square  miles,  all 
between  27°  15'  and  47°  30'  north  latitude,  and  between  67°  and 
99°  45'  west  longitude.  From  this,  however,  deduction  is  to  be 
made  of  37,739  square  miles,  on  account  of  interior  spaces  con- 
taining no  population.  To  what  remains  we  must  add  11,810 
square  miles  on  account  of  settled  tracts  east  of  the  icoth  me- 
ridian, lying  outside  of  the  frontier  line,  and  120,100  square  miles 
on  account  of  settlements  in  the  Cordilleran  region  and  on  the 
Pacific  coast,  making  the  total  area  of  settlement  for  1870  not 
less  than  1,272,239  square  miles,  the  aggregate  population  being 


304  SELECTIONS. 

38,558,371,   and  the   average  density  of  settlement  30.3  to  the 
square  mile. 

188O. 

In  tracing  the  history  of  the  settlement  of  our  country  we  are 
now  brought  down  to  the  latest  census,  that  of  1880.  During 
the  decade  just  past  Colorado  has  been  added  to  the  sisterhood  of 
States.  The  first  point  that  strikes  us  in  examining  the  map 
showing  the  areas  of  settlement  at  this  date,  as  compared  with 
previous  ones,  is  the  great  extent  of  territory  which  has  been 
brought  under  occupation  during  the  past  ten  years.  Not  only 
has  settlement  spread  westward  over  large  areas  in  Dakota, 
Nebraska,  Kansas,  and  Texas,  thus  moving  the  frontier  line  of 
the  main  body  of  settlement  westward  many  scores  of  miles,  but 
the  isolated  settlements  of  the  Cordilleran  region  and  of  the 
Pacific  coast  show  enormous  accessions  of  occupied  territory. 

The  migration  of  farming  population  to  the  northeastern  part 
of  Maine  has  widened  the  settled  area  to  a  marked  extend,  prob- 
ably more  than  has  been  done  during  any  previous  decade. 
The  vacant  space  in  the  Adirondack  region  of  Northern  New 
York  has  been  lessened  in  size,  and  its  limits  reduced  practically 
to  the  actual  mountain  tract.  The  most  notable  change,  however, 
in  New  England  and  the  Middle  States,  including  Ohio  and  Indi- 
ana, has  been  the  increase  in  density  of  population  and  the 
migration  to  cities,  with  the  consequent  increase  of  the  urban 
population,  as  indicated  by  the  number  and  the  size  of  the  spots 
representing  these  cities  upon  the  map.  Throughout  the  South- 
ern States  there  is  to  be  noted  not  only  a  general  increase  in  the 
density  of  population  and  a  decrease  of  unsettled  areas,  but  a 
greater  approach  to  uniformity  of  settlement  throughout  the 
whole  region.  The  unsettled  area  of  the  peninsula  of  Florida 
has  decreased  decidedly,  while  the  vacant  spaces  heretofore  seen 
along  the  upper  coast  of  Florida  and  Louisiana  have  entirely 
disappeared.  Although  the  Appalachian  mountain  system  is  still 
distinctly  outlined  by  its  general  lighter  color  on  the  map,  its 
density  of  population  more  nearly  approaches  that  of  the  country 
on  the  east  and  on  the  west.  In  Michigan  there  is  seen  a  very 
decided  increase  of  the  settled  region.  Settlements  have  not  only 
surrounded  the  head  of  the  lower  peninsula,  but  they  leave  only 
a  very  small  body  of  unsettled  country  in  the  interior.  In  the 
upper  peninsula  the  copper  and  the  iron  interests,  and  the  rail- 


U.    S.    POPULATION,    1880.  305 

roads  which  subserve  them,  have  peopled  quite  a  large  extent  of 
territory.  In  Wisconsin  the  unsettled  area  is  rapidly  decreasing 
as  railroads  stretch  their  arms  out  over  the  vacant  tracts.  In 
Minnesota  and  in  Eastern  Dakota  the  building  of  railroads,  and 
the  development  of  the  latent  capabilities  of  this  region  in  the 
cultivation  of  wheat,  have  caused  a  rapid  flow  of  settlement,  and 
now  the  frontier  line  of  population,  instead  of  returning  to  Lake 
Michigan,  as  it  did  ten  years  ago,  meets  the  boundary  line  of 
the  British  possessions  west  of  the  97th  meridian.  The  settle- 
ments in  Kansas  and  Nebraska  have  made  great  strides  over 
the  plains,  reaching  at  several  points  the  boundary  of  the  humid 
region,  so  that  their  westward  extension  beyond  this  point  is  to 
be  governed  hereafter  by  the  supply  of  water  in  the  streams.  As 
a  natural  result,  we  see  settlements  following  these  streams  in 
long  ribbons  of  population.  In  Nebraska  these  harrow  belts  have 
reached  the  western  boundary  of  the  State  at  two  points :  one 
upon  the  South  Platte,  and  the  other  upon  the  Republican  river. 
In  Kansas,  too,  the  settlements  have  followed  the  Kansas  river 
and  its  branches  and  the  Arkansas  nearly  to  the  western  boundary 
of  the  State.  Texas  also  has  made  great  strides,  both  in  the  ex- 
tension of  the  frontier  line  of  settlement  and  in  the  increase  in 
the  density  of  population,  due  both  to  the  building  of  railroads 
and  to  the  development  of  the  cattle,  sheep,  and  agricultural  in- 
terests. The  heavy  population  in  the  prairie  portions  of  the  State 
is  explained  by  the  railroads  which  now  traverse  them.  In 
Dakota,  besides  the  agricultural  region,  in  the  eastern  part  of  the 
Territory,  we  note  the  formation  of  a  body  of  settlement  in  the 
Black  Hills,  in  the  southwest  corner,  which,  in  1870,  was  a  part 
of  the  reservation  of  the  Sioux  Indians.  This  settlement  is  the 
result  of  the  discovery  of  valuable  gold  deposits.  In  Montana 
there  appears  a  great  extension  of  the  settled  area,  which,  as  it  is 
mainly  due  to  agricultural  interests,  is  found  chiefly  along  the 
courses  of  the  streams.  Mining  has,  however,  played  not  a 
small  part  in  this  increase  in  settlement.  Idaho,  too,  shows  a 
decided  growth  from  the  same  causes.  The  small  settlements 
which,  in  1870,  were  located  about  Boise  City,  and  near  the  mouth 
of  the  Clearwater,  have  now  extended  their  areas  to  many  hun- 
dreds of  square  miles.  The  settlement  in  the  southeastern  corner 
of  the  territory  is  almost  purely  of  Mormons,  and  has  not  made  a 
marked  increase. 

Of   all    the    States  and  Territories  of  the   Cordilleran  region 


306  SELECTIONS. 

Colorado  has  made  the  greatest  stride  during  the  decade.  From 
a  narrow  strip  of  settlement,  extending  along  the  immediate 
base  of  the  Rocky  Mountains,  the  belt  has  increased  so  that  it 
comprises  the  whole  mountain  region,  besides  a  great  extension 
outward  upon  the  plains.  This  increase  is  the  result  of  the  dis- 
covery of  very  extensive  and  very  rich  mineral  deposits  about  Lead- 
ville,  producing  a  u  stampede  "  second  only  to  that  of  '49  and  '50  to 
California.  Miners  have  spread  over  the  whole  mountain  region, 
till  every  range  and  ridge  swarms  with  them.  New  Mexico  shows 
but  little  change,  although  the  recent  extension  of  railroads  in  the 
Territory  and  the  opening  up  of  mineral  resources  will,  no  doubt, 
in  the  near  future,  add  largely  to  its  population.  Arizona,  too, 
although  its  extent  of  settlement  has  increased  somewhat,  is  but 
just  commencing  to  enjoy  a  period  of  rapid  development,  owing 
to  the  extension  of  railroads  and  to  the  suppression  of  hostile 
Indians.  Utah  presents  us  with  a  case  dissimilar  to  any  other  of 
the  Territories,  —  a  case  of  steady,  regular  growth,  due  almost 
entirely  to  its  agricultural  capabilities,  as  was  noted  above.  This 
is  due  to  the  policy  of  the  Mormon  Church,  which  has  steadily 
discountenanced  mining  and  speculation  in  all  forms,  and  has 
encouraged  in  every  way  agricultural  pursuits.  Nevada  shows  a 
slight  extension  of  settlement,  due  mainly  to  the  gradual  increase 
in  the  agricultural  interest.  The  mining  industry  is  probably  not 
more  flourishing  at  present  in  this  State  than  it  was  ten  years  ago, 
and  the  population  dependent  upon  it  is,  if  anything,  less  in 
number.  In  California,  as  the  attention  of  the  people  has  be- 
come devoted  more  and  more  to  agricultural  pursuits,  at  the  ex- 
pense of  the  mining  and  cattle  industries,  we  note  a  tendency  to 
a  more  even  distribution  of  the  inhabitants.  The  population  in 
some  of  the  mining  regions  has  decreased,  while  over  the  area  of 
the  great  valley,  and  in  the  fertile  valleys  of  the  Coast  ranges,  it 
has  increased.  In  Oregon  the  increase  has  been  mainly  in  the 
section  east  of  the  Cascade  range,  a  region  drained  by  the  Des 
Chutes  and  the  John  Day  rivers,  and  by  the  smaller  tributaries 
of  the  Snake,  —  a  region  which,  with  the  corresponding  section  in 
Washington  Territory,  is  now  coming  to  the  front  as  a  wheat- 
producing  district.  In  most  of  the  settled  portions  here  spoken 
of  irrigation  is  not  necessary  for  the  cultivation  of  crops,  and 
consequently  the  possibilities  of  the  region  in  the  direction  of  agri- 
cultural development  are  very  great.  In  Washington  Territory, 
which  in  1870  had  been  scarcely  touched  by  immigration,  we  find 


U.    S.    POPULATION,    I880.  307 

the  valley  west  of  the  Cascade  Mountains  tolerably  well  settled 
throughout,  while  the  stream  of  settlement  has  poured  up  the 
Columbia  into  the  valleys  of  the  Walla  Walla  and  the  Snake 
rivers  and  the  great  plain  of  the  Columbia,  induced  thither  by 
the  facilities  for  raising  cattle  and  by  the  great  profits  of  wheat 
cultivation. 

The  length  of  the  frontier  line  in  1880  is  3,337  miles.  The 
area  included  between  the  frontier  line,  the  Atlantic  and  the  Gulf 
coast,  and  the  northern  boundary  is  1,398,945  square  miles,  lying 
between  26°  and  49°  north  latitude  and  67°  and  102°  west  longi- 
tude. From  this  must  be  deducted,  for  unsettled  areas,  as  fol- 
lows :  — 

Square  Miles. 

Maine    .......  12,000 

New  York      .         .         .         .         .         .  '      2,200 

Michigan        .         .         i     '    *'        .         .  10,200 

Wisconsin      .          .         .         .         .         ,  10,200 

Minnesota      .         .         ...         .  34,000 

Florida            .         .         .'        . '       ,         ,  20,800 

making  a  total  of  89,400  square  miles,  leaving  1,309,545  square 
miles. 

To  this  must  be  added  the  isolated  areas  of  settlement  in  the 
Cordilleran  region  and  the  extent  of  settlement  on  the  Pacific 
coast,  which  amount,  in  the  aggregate,  to  260,025  square  miles, 
making  a  total  settled  area  of  1,569,570  square  miles.  The 
population  is  50,155,783,  and  the  average  density  of  settlement  32 
to  the  square  mile.  • 


308  SELECTIONS. 


THE    FACTORY    SYSTEM. 

FROM  WRIGHT'S   REPORT  ON  THE  FACTORY  SYSTEM  OF  THE  UNITED 
STATES,  TENTH  CENSUS,  VOL.  II.,  PP.  537-541. 

At  the  time  of  the  agitation  of  their  independence  the  desire  to 
plant  the  mechanic  arts  in  this  country  became  almost  a  passion 
—  certainly  a  feature  of  the  patriotism  of  the  day.  Hon.  Edward 
Everett,  in  an  address  on  American  manufactures,  in  New  York, 
in  1831,  stated  :  — 

"  The  first  measures  of  the  patriots  aimed  to  establish  their 
independence  on  the  basis  of  the  productive  industry  and  labori- 
ous arts  of  the  country.  They  began  with  a  non-importation 
agreement  nearly  two  years  before  the  Declaration  of  Independ- 
ence. That  agreement,  .  .  .  with  the  exception  of  the 
Address  to  the  People  of  America  and  Great  Britain,  was  the 
only  positive  act  of  the  first  Congress." 

In  this  country,  as  well  as  in  England,  the  germ  of  the  textile 
factory  existed  in  the  fulling  and  carding  mills  ;  the  former,  dating 
earlier,  being  the  mills  for  finishing  the  coarse  cloths  woven  by 
hand  in  the  homes  of  our  ancestors ;  in  the  latter,  the  carding- 
mill,  the  wool  was  prepared  for  the  hand-wheel.  At  the  close  of 
the  Revolution  the  domestic  system  of  manufactures  prevailed 
throughout  the  States. 

The  first  attempts  to  secure  the  spinning  machinery  which  had 
come  into  use  in  England  were  made  in  Philadelphia  early  in  the 
year  1775,  when  probably  the  first  spinning-jenny  ever  seen  in 
America  was  exhibited  in  that  city.  During  the  war  the  manu- 
facturers of  Philadelphia  extended  their  enterprises,  and  even 
built  and  run  mills  which  writers  often  call  factories,  but  they 
can  hardly  be  classed  under  that  term.  Similar  efforts,  all  pre- 
liminary to  the  establishment  of  the  factory  system,  were  made 
in  Worcester,  Massachusetts,  in  1780.  In  1781  the  British  Par- 
liament, determined  that  the  textile  machinery  by  which  the 
manufactures  of  England  were  being  rapidly  extended,  and  which 
the  continental  producers  were  anxious  to  secure,  should  not  be 
used  by  the  people  of  America,  reenacted  and  enlarged  the  scope 
of  the  Statute  of  1774  against  its  exportation.  By  21  George  III., 
c.  37,  it  was  provided  that  any  person  who  packed  or  put  on 
board,  or  caused  to  be  brought  to  any  place  in  order  to  be  put  on 


U.    S.    FACTORY   SYSTEM.  309 

any  vessel  for  exportation,  any  machine,  engine,  tool,  press,  paper, 
utensil,  or  implement,  or  any  part  thereof,  which  now  is  or  here- 
after may  be  used  in  the  woollen,  cotton,  linen,  or  silk  manufact- 
ure of  the  kingdom,  or  goods  wherein  wool,  cotton,  linen,  or 
silk  are  used,  or  any  model  or  plan  of  such  machinery,  tool, 
engine,  press,  utensil,  or  implement,  should  forfeit  every  such 
machine,  etc.,  and  all  goods  packed  therewith,  and  £200,  and 
suffer  imprisonment  for  one  year.  In  1782  a  law  was  enacted 
which  prohibited,  under  penalty  of  £500,  the  exportation  or  the 
attempt  to  export  "blocks,  plates,  engines,  tools,  or  utensils  used 
in  or  which  are  proper  for  the  preparing  or  finishing  of  the  calico, 
cotton,  muslin,  or  linen  printing  manufactures,  or  any  part  there- 
of." The  same  act  prohibited  the  transportation  of  tools  employed 
in  the  iron  and  steel  manufactures.  Acts  were  also  passed  inter- 
dicting the  emigration  of  artificers.  All  these  laws  were  enforced 
with  great  vigilance,  and  were  of  course  serious  obstacles  to  the 
institution  of  the  new  system  of  manufacture  in  America. 

The  manufacturers  of  this  country  were  thus  compelled  either 
to  smuggle  or  to  invent  their  machinery.  Both  methods  were 
practised  until  most  of  the  secrets  of  the  manufacture  of  common 
goods  were  made  available  here. 

The  planting  of  the  mechanic  arts  in  this  country  became  a 
necessity  during  the  War  of  the  Revolution,  and  afterwards  the 
spirit  of  American  enterprise  demanded  that  New  England  and 
the  Middle  States  should  utilize  the  water-powers  which  they 
possessed,  and  by  such  utilization  supply  the  people  with  home 
manufactures. 

When  the  people  of  the  States  saw  that  the  Treaty  of  Paris  had 
not  brought  industrial  independence,  a  new  form  of  expression 
of  patriotism  took  the  place  of  military  service ;  and  associations 
were  formed,  the  object  of  which  was  to  discourage  the  use  of 
British  goods,  and  as  the  Articles  of  Confederation  did  not  pro- 
vide for  the  regulation  of  commerce,  the  Legislatures  of  the  States 
were  besought  to  protect  home  manufactures.  The  Constitution 
of  1789  remedied  the  defects  of  the  articles  in  this  respect,  and 
gave  Congress  the  power  to  legislate  on  commercial  affairs.  The 
Constitution  was  really  the  outcome  of  the  industrial  necessities 
of  the  people,  because  it  was  on  account  of  the  difficulties  and 
the  irritations  growing  out  of  the  various  commercial  regulations 
of  the  individual  States  that  a  convention  of  commissioners  from 
the  various  States  was  held  at  Annapolis  in  September,  1786, 


31O  SELECTIONS. 

which  convention  recommended  the  one  that  framed  the  new  or 
present  Constitution  of  the  United  States. 

Of  course  those  industries  whose  products  were  called  for  by 
the  necessities  of  the  war  were  greatly  stimulated,  but  with  peace 
came  reaction  and  the  flooding  of  our  markets  with  foreign 
goods. 

The  second  act  under  the  Constitution  was  passed  July  4, 
1789,  with  this  preamble:  — 

"Whereas  it  is  necessary  for  the  support  of  the  government,  for 
the  discharge  of  the  debts  of  the  United  States,  and  for  the  en- 
couragement and  the  protection  of  manufactures,  that  duties  be 
laid  on  goods,  wares,  and  merchandise  imported  ; 

"  Be  it  enacted,  etc." 

Patriotism  and  statute  law  thus  paved  the  way  for  the  importa- 
tion of  the  factory  system  of  industry,  and  so  its  institution  here, 
as  well  as  in  England,  was  the  result  of  both  moral  and  econom- 
ical forces. 

As  early  as  1786,  before  the  adoption  of  the  Constitution  of 
the  United  States,  the  Legislature  of  Massachusetts  offered  encour- 
agement for  the  introduction  of  machinery  for  carding  and  spin- 
ning by  granting  to  Robert  and  Alexander  Barr  the  sum  of  £200 
to  enable  them  to  complete  a  roping-machine,  and  also  to  "  con- 
struct such  other  machines  as  are  necessary  for  the  purpose  of 
carding,  roping,  and  spinning  of  sheep's  wool,  as  well  as  of 
cotton  wool."  The  next  year  these  parties  were  granted  six 
tickets  in  a  land-lottery.  Others  engaged  in  the  invention  and 
construction  of  cotton-spinning  machines  at  Bridgewater,  being 
associated  with  the  Barrs,  who  came  to  Massachusetts  from  Scot- 
land at  the  invitation  of  Hon.  Hugh  Orr,  of  Bridgewater,  and 
for  the  purpose  of  constructing  spinning-machines.  There  is  no 
doubt  that  the  machinery  built  by  them  was  the  first  in  this 
country  which  included  the  Arkwright  devices  ;  the  first  factory, 
however,  in  America  expressly  for  the  manufacture  of  cotton 
goods  was  erected  at  Beverly,  Massachusetts,  in  1787.  This 
enterprise  was  aided  by  the  Legislature.  The  factory  at  Beverly 
was  built  of  brick,  was  driven  by  horse-power,  and  was  con- 
tinued in  operation  for  several  years,  but  its  career  as  a  cotton- 
mill  was  brief,  and  no  great  success  attended  it.  About  the  same 
time  other  attempts  had  been  made  in  Rhode  Island,  New  York, 
and  Pennsylvania,  but  principally  in  Rhode  Island  and  that  part 
of  Massachusetts  contiguous  to  Rhode  Island. 


U.    S.    FACTORY   SYSTEM.  311 

The  honor  of  the  introduction  of  power-spinning  machines  in 
this  country,  and  of  their  early  use  here,  is  shared  by  these  last- 
named  States;  for  while  Massachusetts  claims  to  have  made  the 
first  experiments   in   embodying  the  principles   of  Arkwright's 
inventions  and  the  first  cotton  factory  in  America,  Rhode  Island 
claims  the  first  factory  in  which  perfected  machinery,  made  after 
the  English   models,  was  practically  employed.     This  was  the 
factory   built  by   Samuel    Slater,  in    1790,  in  Pawtucket,  Rhode 
Island,  which  still  stands  in  the  rear  of  Mill  street  in  that  city,  and 
the  hum  of  cotton  machinery  can  still  be  heard  within  its  walls. 
Previous  to    179°   the    common  jenny  and  stock-card   had   been 
in  operation  upon   a  small  scale  in  various  parts  of  the  United 
States,  but  principally  in  Pennsylvania,  New  York,  Rhode  Island, 
and  Massachusetts ;  but  every  endeavor  to  introduce  the  system 
of    spinning   known    as   water-frame    spinning,    or   Arkwright's 
method,  had   failed.     The   introduction   of  this  system  was  the 
work  of  Slater,  whom  President  Jackson  designated  "  The  father 
of  American  manufactures."     Samuel  Slater  was  born  in  Belper, 
Derbyshire,  England,  June  9,  1768,  and  at  fourteen  years  of  age 
was  bound  as  an  apprentice  to  Jedediah  Strutt,  Esq.,  a  manufact- 
urer of  cotton  machinery   at  Milford,  near  Belper.     Strutt  was 
for  several  years  a  partner  of  Sir  Richard  Arkwright  in  the  cot- 
ton-spinning business  ;  so  young  Slater  had  every  opportunity  to 
master  the  details   of  the   construction  of  the  cotton  machinery 
then  in  use  in  England,  for  during  the   last  four  or  five  years  of 
his  apprenticeship    he  served    as   general  overseer,  not  only  in 
making   machinery,    but   in   the    manufacturing   department    of 
Strutt's   factory.     Near  the  close  of  his  term  his  attention  was 
drawn  to  the  wants  of  the  States  by  accidentally  seeing  a   notice 
in  an  American  paper  of  the  efforts  various  States  were  making 
by  way  of  offering  bounties  to  parties  for  the  production  of  cotton 
machinery.     Slater  knew  well  that  under  the  laws  of  England 
he  could  carry  neither  machines  nor  models  or  plans  of  machines 
out  of  the  country  ;  so,  after  completing  his  full  time  with  Mr. 
Strutt,  he  continued  some  time   longer  with  him,  superintending 
some  new  works  Mr.  Strutt  was  erecting.     This  he  did  that  he 
might  so  perfect  his  knowledge  of  the  business  in  every  depart- 
ment  that   he   could  construct  machinery  from  memory  without 
taking  plans,  models,  or  specifications.      With   this   knowledge 
Slater  embarked  at  London,  September  13,  1789,  for  New  York, 
where  he  landed  November  17,  and  at  once  sought  parties  inter- 


312  SELECTIONS. 

ested  in  cotton  manufactures.  Finding  the  works  of  the  New 
York  Manufacturing  Company,  to  whom  he  was  introduced, 
unsatisfactory,  he  corresponded  with  Messrs.  Brown  &  Almy, 
of  Providence,  who  owned  some  crude  spinning-machines,  some 
of  which  came  from  the  factory  at  Beverly,  Massachusetts.  In 
January,  1790,  Slater  made  arrangements  with  Brown  &  Almy 
to  construct  machinery  on  the  English  plan.  This  he  did  at 
Pawtucket,  making  the  machinery  principally  with  his  own 
hands,  and  on  the  2Oth  of  December,  i79°i  he  started  three  cards, 
drawing  and  roving,  together  with  seventy-two  spindles,  working 
entirely  on  the  Arkwright  plan,  and  being  the  first  of  the  kind 
ever  operated  in  America. 

It  is  generally  supposed  that  the  course  of  the  progress  of  the 
manufacture  of  cotton  goods  in  this  country  is  quite  clearly  marked, 
yet  a  careful  study  of  the  subject  seems  rather  to  dissipate  the  line 
of  advancement  instead  of  bringing  it  into  clearer  view.  Dr. 
Leander  Bishop,  in  his  exceedingly  valuable  work,  "  A  History 
of  American  Manufactures,"  in  speaking  of  the  clothing  manu- 
facture, states  that  a  correspondent  of  the  "  American  Museum," 
writing  from  Charleston,  South  Carolina,  in  July,  1790,  refers  to 
a  gentleman  who  "  had  completed,  and  had  in  operation  on  the 
High  Hills  of  the  Santee,  near  Statesburg,  ginning,  carding,  and 
other  machines  driven  by  water,  and  also  spinning-machines, 
with  eighty-four  spindles  each,  with  every  necessary  article  for 
manufacturing  cotton.  If  this  information  be  correct,  the  attempt 
to  manufacture  by  machinery  the  cotton  which  they  were  then 
beginning  to  cultivate  extensively  was  nearly  as  early  as  those  of 
the  Northern  States." 

Certainly  this  bit  of  history  of  attempts  in  Southern  States,  of 
the  efforts  of  Samuel  Wetherell,  of  Philadelphia,  of  the  Beverly 
Company,  in  Massachusetts,  of  Moses  Brown,  at  Providence, 
R.I.,  all  before  Slatei"'s  coming,  to  introduce  spinning  by  power, 
illustrates  the  difficulty  of  locating  the  origin  of  an  institution 
when  a  country  of  such  proportions  as  our  own  constitutes  the 
field.  It  is  safe,  historically,  to  start  with  Slater  as  the  first  to 
erect  cotton  machinery  on  the  English  plan,  and  to  give  the  factory 
system  1790  as  its  birthday. 

The  progress  of  the  system  has  been  uninterrupted  from  1790, 
save  by  temporary  causes  and  for  brief  periods  ;  but  these  inter- 
ruptions only  gave  an  increased  impetus  to  its  growth. 

In  1792,  by  the  invention  of  the  cotton-gin,  an  American,  Eli 


U.   S.   FACTORY   SYSTEM.  313 

Whitney,  of  Massachusetts,  residing  temporarily  in  Georgia, 
contributed  as  much  toward  the  growth  of  the  factory  system  as 
England  had  contributed  by  the  splendid  series  of  inventions 
which  made  the  cotton-manufacturing  machinery  of  the  system. 

The  alarm  of  the  people  at  the  increase  in  the  demand  for 
foreign  goods  took  shape  again  in  1794  and  the  decade  following, 
and,  by  patriotic  appeals  to  all  classes,  societies  and  clubs  were 
formed  pledged  to  wear  only  home-made  goods.  Congress  was 
called  upon  to  restrict  importations.  The  result  of  all  these 
efforts  and  influences  stimulated  the  manufacture  of  cotton  and 
other  textiles.  The  water  privileges  of  New  England  and  the 
Middle  States  offered  to  enterprising  men  the  inducement  to  build 
factories  for  the  spinning  of  yarn  for  the  household  manufacture 
of  cloth.  At  the  close  of  1809,  according  to  a  report  made  by 
Mr.  Albert  Gallatin,  Secretary  of  the  Treasury  in  1810,  eighty- 
seven  cotton  factories  had  been  erected  in  the  United  States, 
which,  when  in  operation,  would  employ  80,000  spindles. 

The  perfect  factory,  the  scientific  arrangement  of  parts  for  the 
successive  processes  necessary  for  the  manipulation  of  the  raw 
material  till  it  came  out  finished  goods,  had  not  yet  been  con- 
structed. As  I  have  said,  the  power-loom  did  not  come  into  use 
in  England  till  about  1806,  while  in  this  country  it  was  not  used 
at  all  till  after  the  war  of  1812.  In  England,  even,  it  had  not  been 
used  in  the  same  factory  with  the  spinning-machines.  In  fact, 
for  many  years  the  custom  of  spinning  the  yarn  under  one  man- 
agement and  weaving  the  cloth  under  another  has  prevailed  in 
England. 

In  i8n,Mr.  Francis  C.  Lowell,  of  Boston,  visited  England, 
and  spent  much  time  in  inspecting  cotton  factories,  for  the  pur- 
pose of  obtaining  all  possible  information  relative  to  cotton  manu- 
facture, with  a  view  to  the  introduction  of  improved  machinery 
in  the  United  States.  The  power-loom  was  being  introduced  in 
Great  Britain  at  this  time,  but  its  construction  was  kept  very 
secret,  and  public  opinion  was  not  very  favorable  to  its  success. 
Mr.  Lowell  learned  all  he  could  regarding  the  new  machine,  and 
determined  to  perfect  it  himself.  He  returned  to  the  States  in 
1814,  and  at  once  began  his  experiments  on  Broad  street,  Boston. 
His  first  move  was  to  secure  the  skill  of  Paul  Moody,  of  Amesbury, 
Mass.,  a  well-known  mechanic.  By  and  through  the  encourage- 
ment of  Mr.  Nathan  Applelon,  a  company  had  been  organized 
by  Mr.  Lowell  and  Mr.  Patrick  T.  Jackson,  with  Mr.  Appleton 


314  SELECTIONS. 

as  one  of  its  directors,  for  the  establishment  of  a  cotton  manu- 
factory, to  be  located  in  Waltham,  Mass.,  on  a  water  privilege 
they  had  purchased.  This  factory  was  completed  in  the  autumn 
of  1814,  and  in  it  was  placed  the  loom  perfected  by  Mr.  Lowell, 
which  differed  much  from  the  English  looms.  Mr.  Lowell  had 
neither  plans  nor  models  for  his  factory  and  looms,  but  in  the 
year  named  the  company  set  up  a  full  set  of  machinery  for  weav- 
ing and  spinning,  there  being  1,700  spindles;  and  this  factory  at 
Waltham  was  the  first  in  the  world,  so  far  as  record  shows,  in 
which  all  the  processes  involved  in  the  manufacture  of  goods, 
from  the  raw  material  to  the  finished  product,  were  carried  on  in 
one  establishment  by  successive  steps,  mathematically  considered, 
under  one  harmonious  system.  Mr.  Francis  C.  Lowell,  aided  by 
Mr.  Jackson,  is  unquestionably  entitled  to  the  credit  of  arranging 
this  admirable  system,  and  it  is  remarkable  how  few  changes 
have  been  made  in  the  arrangements  established  by  him  in  this 
factory  at  Waltham. 

So  America  furnished  the  stone  which  completed  the  industrial 
arch  of  the  factory  system  of  manufactures. 

The  growth  of  the  factory  system  [is  well]  illustrated  by  the 
cotton  manufacture.  After  the  success  of  the  power-loom,  the  cot- 
ton manufacture  took  rapid  strides,  both  in  Europe  and  America. 
The  hand-loom  and  the  hand-weaver  were  rapidly  displaced. 
Factories  sprung  up  on  all  the  streams  of  Yorkshire  and  Lanca- 
shire, in  England,  while  in  this  country  the  activity  of  the 
promoters  of  the  industry  won  them  wealth,  and  won  cities  from 
barren  pastures.  They  erected  Lowell,  Lawrence,  Holyoke, 
Fall  River,  and  many  other  thriving  cities  and  towns,  and  now 
in  this  generation  the  industry  is  taking  root  upon  the  banks  of 
Southern  streams.  The  progressive  steps  of  this  great  trade  are 
shown  by  the  tables  which  follow.  The  facts  for  Great  Britain 
for  the  year  1833  are  taken  from  Baines'  History  of  Cotton 
Manufacture,  and  have  been  corroborated  as  far  as  possible  from 
other  sources  ;  they  constitute  the  most  reliable  data  obtainable 
for  that  period.  For  1831,  for  the  United  States,  we  have  the 
census  returns  and  other  sources,  none  of  them  very  accurate,  yet 
they  give  the  best  approximate  figures. 

It  will  be  observed  that  the  number  of  cotton  factories  in  this 
country  was  801  in  1831,  1,240  in  1840,  1,074  in  1850,  and  that 
since  1850  there  has  been  a  constant  decrease  in  the  number  of 
establishments.  This  is  the  result  of  consolidation  and  the  estab- 


U.    S.   FACTORY   SYSTEM.  315 

lishment  of  large  works,  the  smaller  factories  being  closed  or 
united  with  the  large  ones.1  While  the  number  of  factories  has 
decreased,  the  consumption  of  cotton  and  the  production  of  goods 
has  steadily  increased.  Perhaps  the  best  gauge  for  the  progress 
of  the  industry  is  to  be  found  in  the  quantity  of  cotton  consumed 
per  capita  of  the  population.  In  Great  Britain,  in  1831,  the  home 
consumption  of  cotton  per  capita  (excluding  the  proportion  for 
the  export  trade)  was  6.62  pounds  ;  in  1881  it  was  7.75  pounds  ; 
in  the  United  States,  for  1830,  it  was  5.9  pounds  ;  in  1880  it  was 
13.91  pounds.  That  is,  the  clothing  of  the  people  of  this  country 
in  1830  required  5.9  pounds  of  cotton  per  annum,  and  now  it  re- 
quires 13.91  pounds. 

If  we  take  the  per  capita  consumption  of  the  factories,  includ- 
ing exports  and  home  consumption,  the  proportion  for  Great 
Britain  in  1831  was  16.15  pounds;  in  1881,  40.8  pounds ;  for  the 
United  States,  in  1831,  it  was,  on  this  basis,  6.1  pounds;  in  1880 
it  had  risen  to  14.96  pounds.  The  ratios  given  as  to  spindles  to 
persons  employed,  capital  to  spindles,  product  to  spindles,  capital 
to  product,  product  to  persons  employed,  while  in  some  sense 
fallacious,  and  more  valuable  to  the  expert  than  to  the  general 
reader,  yet  are  true  for  the  time  given  and  the  existing  cir- 
cumstances, and  certainly  show  the  change  of  circumstances. 
The  ratio  of  consumption  to  spindles  is  of  course  influenced 
largely  by  the  number  of  the  yarn  produced,  and  many  of  the 
British  mills  spin  finer  numbers  than  do  the  mills  of  this  country  ; 
but  whatever  may  be  the  cause,  the  ratio  stands  as  given,  and 
shows  that  the  attendant  circumstances,  either  of  machinery  or 
kind  of  product,  or  of  some  other  matter,  vary  as  to  the  two 
countries. 

»The  number  of  cotton  factories  for  1880  should  be  increased  by  the  number  of  mills  en- 
gaged in  working  raw  cotton,  waste,  or  cotton  yarn  into  hosiery,  webbing,  tapes,  fancy 
fabrics,  or  mixed  goods,  or  other  fabrics  which  are  not  sold  as  specific  manufactures  of  cot- 
ton  or  of  wool;  some  of  these  work  both  fibres,  but  belong  more  in  the  class  of  cotton  manu- 
factures than  in  any  other.  These  establishments,  249  in  all,  in  1880,  have,  without  doubt, 
been  included  in  the  list  of  cotton-mills  heretofore;  so  that  now  the  total  number,  to  corre- 
spond with  the  past,  should  be  1,005  cotton  factories  in  the  United  States  in  1880. 


316 


SELECTIONS. 


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U.    S.    COTTON   MANUFACTURES.  317 


THE    COTTON  MANUFACTURES. 

FROM  ATKINSON'S   REPORT  ON  THE   COTTON  MANUFACTURES,  TENTH 
CENSUS,  VOL.  II.,  pp.  946-955. 

The  cotton  manufacture  of  the  United  States  may  be  now  con- 
sidered more  firmly  established  than  ever  before.  The  method 
on  which  the  business  is  conducted  in  the  United  States  varies 
greatly  from  that  of  any  other  country  ;  and  this  difference  arises 
mainly  from  a  difference  not  only  in  the  habits  and  customs  of  the 
people,  but  also  in  their  condition  and  intelligence. 

The  home  market  is  the  most  important  one,  and  may  long 
continue  to  be  so,  although  the  export  demand  for  our  fabrics  now 
takes  from  7  to  8  per  cent,  of  our  annual  product,  and  is  likely  to 
increase. 

In  contrast  with  the  cotton  manufacturer  of  Great  Britain,  our 
principal  rival,  we  are  therefore  called  upon  to  meet  the  demands 
jpf  an  intelligent  class  of  customers  living  under  substantially  uni- 
form conditions  and  varying  but  little  in  their  requirements. 
Hence  we  are  not  called  upon  for  the  great  variety  of  fabrics  that 
must  be  supplied  by  Great  Britain.  In  consequence  of  this  de- 
mand for  a  great  variety  of  fabrics  the  work  of  the  cotton  manu- 
facturer of  England  is  much  more  divided  than  with  us.  With 
the  exception  of  a  few  large  establishments,  working  mainly  to 
supply  the  home  market,  few  goods  are  known  in  England  by  the 
name  of  the  factory  in  which  they  are  made,  nor  are  they  sold 
under  the  name  of  the  manufacturer;  but  to  a  very  large  extent  the 
yarn  is  spun  in  one  establishment,  woven  in  another,  and  finished 
in  a  third.  The  gray  cloth  is  sold  to  the  warehouseman,  or  to 
the  merchant,  to  be  stamped  and  packed  by  him,  or  to  be  dyed, 
bleached,  or  printed  under  his  direction.  If  English  goods  had 
been  sold  under  the  name  and  stamp  of  the  manufacturer,  as  cot- 
ton goods  are  in  the  United  States,  perhaps  the  substitution  of 
clay  for  cotton  might  not  have  been  carried  to  so  great  an  extent. 
In  the  United  States  cotton  goods  are  spun  and  woven  in  the 
same  factory,  and,  whether  sold  in  the  gray  or  bleached,  they  are 
almost  all  stamped  and  marketed  under  the  name  of  the  factory  in 
which  they  are  made.  Each  factory,  therefore,  has  its  reputation 
to  sustain,  and  whether  the  fabric  be  coarse  or  fine  it  is  the  effort 
of  every  one  to  make  it  good  of  its  kind. 


3l8  SELECTIONS. 

The  same  rule  applies  to  printed  calicoes.  These  are  marketed 
under  the  name  of  the  works  in  which  they  have  been  printed, 
and  the  reputation  and  permanent  existence  of  these  works  rest 
upon  uniformity  in  quality,  excellence  in  color  and  style,  and 
constant  progress  in  the  art  of  design. 

We  may  not  claim  to  be  more  honest  than  our  rivals,  but  it 
is  a  great  error  to  suppose  that  it  is  permanently  profitable  to 
make  an  article  that  is  not  what  it  purports  to  be.  A  cotton  fab- 
ric may  be  of  a  low  grade,  and  may  be  intended  to  sell  at  a 
low  price,  but  yet  it  is  not  profitable  to  substitute  clay  for 
cotton ;  the  fabric,  whatever  it  is,  has  its  name  and  reputation, 
and  must  be  true  to  them,  or  else  the  demand  for  it  will  sooner 
or  later  cease.  Even  goods  that  are  made  for  linings,  and 
that  need  to  be  starched  and  stiffened  in  order  to  be  used,  must 
have  a  uniform  quality  in  the  fabric  itself  to  hold  a  permanent 
place  in  our  market.  Dyed  goods  that  require  to  be  woven 
on  heavily-sized  warps  cannot,  except  by  rule,  be  loaded  with 
sizing.  If  an  attempt  is  made  to  introduce  an  article  in  which 
clay  has  been  added  to  make  it  heavier,  it  is  immediately 
detected,  because  the  use  of  sewing-machines  is  almost  universal, 
and  the  clay  in  the  fabric  heats  the  needle  and  exposes  the 
fraud. 

In  stating  those  conditions  under  which  the  manufacture  of  cot- 
ton is  conducted  in  the  United  States  for  the  home  demand,  it  is 
not  intended  to  imply  that  the  use  of  a  foreign  substance  to  give 
additional  weight  to  a  cotton  fabric  is,  of  necessity,  a  fraud.  For 
instance,  there  is  a  very  large  demand  in  China  for  materials  for 
the  grave-clothes  of  corpses,  and  for  this  use  "  earth  to  earth, 
and  dust  to  dust"  maybe  considered  a  legitimate  rule,  even  if 
the  earth  is  conveyed  in  the  fabric  which  is  nominally  made  of  cot- 
ton. Some  of  the  finest  cotton  fabrics  yet  made  in  the  United 
States,  which  closely  resemble  silk,  are  used  mainly  for  lining 
coffins. 

The  principal  market  for  our  own  fabrics  is  found  among  the 
thrifty  working-people,  who  constitute  the  great  mass  of  our 
population. 

It  has  therefore  happened  that,  although  we  have  not  until 
recently  undertaken  the  manufacture  of  very  fine  fabrics,  the 
average  quality  of  the  fabrics  that  we  do  make  is  better  than  that 
of  any  other  nation,  with  the  possible  exception  of  France.  It  is 
for  the  wants  of  the  million  that  our  cotton  factories  are  mainly 


U.    S.   COTTON   MANUFACTURES.  319 

worked,  and  we  have  ceased  to  import  staple  goods,  and  shall 
never  be  likely  to  resume  their  import.  On  the  other  hand,  we 
may  for  a  long  period  continue  to  import  the  finer  goods  that 
depend  mainly  on  fashion  and  style  for  their  use,  and  that  are 
purely  articles  of  luxury.  As  has  been  stated,  the  substantial 
fabrics  that  constitute  the  main  part  of  our  cotton  manufacture, 
and  that  are  used  by  the  masses  of  the  people,  are  of  the  best  of 
their  kind,  with  the  possible  exception  of  those  made  in  France. 
The  French  peasantry  are  a  sagacious  and  truly  economical  race, 
and  will  not  buy  a  poor  fabric  if  they  can  get  a  good  one  ;  hence  the 
cotton  fabrics  for  their  use  are  of  a  very  substantial  kind,  and  are 
much  more  free  from  adulteration  than  those  of  any  other  country 
in  Europe.  The  common  cotton  fabrics  of  England,  Belgium, 
and  Germany  could  hardly  be  sold  in  the  United  States  at  any 
price. 

The  finest  printed  calicoes  of  France  and  England  may  be  the 
best  of  their  kind  ;  but  the  printed  calicoes  for  the  use  of  the  multi- 
tude, and  which  constitute  the  really  important  branch  of  this 
department  of  the  manufacture,  are  of  much  better  quality  in  the 
United  States  than  in  Europe,  and  are  also  of  finer  colors  and  of 
more  varied  styles. 

In  fact,  one  of  the  chief  obstacles  that  it  has  been  necessary  to 
overcome  in  the  introduction  of  unbleached  American  cotton 
fabrics  in  the  English  market,  and  in  other  markets  heretofore 
supplied  by  England,  has  been  their  apparently  open  texture, 
owing  to  the  absence  of  heavy  sizing.  In  the  United  States  the 
sizing  used  upon  the  warp,  and  which  is  necessary  in  order  to 
weave  it,  is  made  from  corn  or  potato  starch,  free  from  any  sub- 
stance intending  to  make  it  heavier.  In  the  gray  cloth  the  sizing, 
therefore,  constitutes  only  2^  to  5  per  cent,  of  the  weight,  and 
when  the  fabric  is  washed  it  shrinks  more  in  measure  than  it 
loses  in  weight ;  hence  a  square  yard  washed  and  dried  without 
stretching  will  be  heavier  than  a  square  yard  taken  directly  from 
the  loom. 

In  England,  on  the  other  hand,  even  the  pure  sizing  is  made 
from  wheat  flour,  which  is  very  glutinous ;  and  the  fabrics  thus 
woven,  even  where  no  adulteration  is  intended,  lose  from  10  to 
12  percent,  of  their  weight  on  the  first  washing.  These  pure 
goods  are,  however,  made  chiefly  for  the  home  consumption  of 
the  richer  classes  of  England.  The  greater  part  of  the  English 
cotton  fabrics,  exported  or  used  by  the  working-classes,  are  loaded 


320  SELECTIONS. 

with  from  10  to  40  per  cent,  of  clay  and  other  substances.  The 
art  of  sizing  has  been  highly  perfected  in  England,  and  has  been 
made  the  subject  of  very  numerous  patents  ;  and,  as  the  use  of 
clay  and  flour  to  the  extent  of  100  pounds  to  each  100  pounds  of 
cotton-warp  yarn  involves  great  danger  of  mildew,  many  ingen- 
ious chemical  applications  have  also  been  patented  to  serve  as 
antiseptics,  such  as  chloride  of  zinc,  chloride  of  calcium,  common 
salt,  white  vitriol,  etc.  These  various  antiseptics  are  compounded 
with  flour,  gypsum,  soapstone,  china  clay,  and  other  heavy  sub- 
stances in  various  ways.  The  English  text-books  upon  the  art  of 
sizing  are  instructive  and  suggestive,  especially  in  respect  to  the 
rules  for  the  purchase  of  the  most  glutinous  kinds  of  flour  and  for 
the  detection  of  adulteration  in  flour,  it  being  obvious  that  unless 
the  flour  is  pure  and  well  adapted  to  the  purpose,  it  would  be 
necessary  to  use  cotton  instead  of  clay  to  make  up  the  weight  of 
the  fabric. 

It  will,  of  course,  take  a  good  deal  of  time  to  accustom  buyers 
to  the  more  open  texture  of  cotton  fabrics  in  which  no  clay 
is  used  ;  but  as  time  passes  American  fabrics  are  being  steadily 
substituted  for  those  previously  used  by  foreign  nations,  espe- 
cially in  China. 

Since  the  year  1860  the  cotton  manufacture  of  the  United 
States  has  been  exposed  to  greater  vicissitudes  than  any  other 
important  branch  of  the  national  industry,  and  the  wonder  is  not 
that  there  should  have  been  some  disasters,  but  that  it  should  have 
survived  at  all  in  the  hands  of  its  original  owners.  In  1860  the 
whole  number  of  spindles  in  the  United  States  was  5,235,000. 
From  1857  to  1860  the  cost  of  constructing  a  spinning  and  weav- 
ing factory  on  the  medium  fabrics  woven  of  No.  25  yarn  was 
from  $16  to  $20  per  spindle  (the  number  designates  the  number 
of  skeins  of  840  yards  of  yarn  each  in  one  pound).  The  value  of 
a  bale  of  cotton  of  480  pounds  was  from  $40  to  $50.  Then  came 
the  combined  effects  of  war,  paper  money,  and  scarcity  of  cotton. 
At  one  period  more  than  two-thirds  of  the  cotton  machinery  of 
the  United  States  was  stopped  ;  the  value  of  a  bale  of  cotton  rose 
to  over  $900,  and  the  price  of  some  kinds  of  goods  was  seven  to 
eight  times  the  present  price.  A  little  later  new  mills  were  con- 
structed which  cost  from  $30  to  $40  per  spindle. 

At  the  date  of  the  census  the  number  of  spindles  operated 
in  the  specific  manufacture  of  cotton  fabrics  was  10,653.435  ;  but 
the  spindle  has  changed  in  its  productive  power,  and  each  spindle 


U.    S.    COTTON   MANUFACTURES.  321 

of  1880  was  much  more  effective  than  that  of  1860.  The  value 
of  the  bale  of  cotton  was  again  from  $40  to  $50 ;  the  standard 
printing-cloth,  which  reached  33  cents  a  yard  during  the  war, 
was  worth  4  cents  ;  the  No.  25  mill  for  spinning  and  weaving 
could  be  built  for  from  $14  to  $18  per  spindle ;  our  export  of 
cotton  fabrics  was  more  in  value  and  much  more  in  quantity  than 
in  1860,  and  the  only  check  to  its  steady  and  profitable  increase 
was  the  renewal  of  the  home  demand.  Such  have  been  the 
changes  and  fluctuations  ;  yet,  despite  them  all,  not  one  spindle  in 
ten  has  passed  from  the  ownership  of  the  person,  firm,  or  cor- 
poration in  whose  possession  it  was  in  1860,  except  in  the  regular 
process  of  bequest  or  voluntary  sale. 

During  the  period  of  inflation  or  of  great  vicissitude,  the  atten- 
tion of  the  managers  of  the  property  was  of  necessity  devoted  to 
other  matters  than  the  improvements  and  minute  savings  in 
which  the  profit  of  the  business  now  consists  ;  but  during  the  last 
few  years  very  great  improvements  have  been  made,  and  the 
lesson  of  economy  and  saving  has  been  learned.  The  best  ex- 
ample that  can  be  cited  may  be  found  in  the  record  of  one  great 
factory  working  upon  coarse  and  substantial  fabrics,  and  consum- 
ing more  than  20,000  bales  of  cotton  a  year.  Sixty  per  cent,  of 
its  products  are  sold  for  export  to  various  parts  of  the  world.  The 
proportion  of  operatives  to  each  1,000  spindles  has  been  de- 
creased 43  per  cent.,  or  from  26^  to  15.  The  wages  of 
women,  who  constitute  more  than  two-thirds  of  the  operatives, 
have  been  increased  33  per  cent.  The  cost  of  making  the 
cloth,  aside  from  the  material  used,  has  been  decreased  21  per 
cent. 

In  1860  the  average  product  of  one  operative,  working  one 
year,  was  5,317  pounds;  in  1880,  7,928  pounds  of  drill,  such  as 
is  exported  to  China.  Assuming  5  pounds,  or  about  16  yards,  as 
the  annual  requirement  of  a  Chinaman  for  dress,  in  1860  one 
Lowell  operative,  working  one  year,  clothed  1,063  Chinese;  in 
1880  one  could  supply  1,586.  It  will  be  obvious  that  no  hand 
spinning  and  weaving  can  compete  with  this  product  of  machin- 
ery ;  yet  the  machine-made  fabrics  of  Europe  and  America 
combined,  have  as  yet  reached  only  six  or  eight  in  a  hundred  of 
the  Chinese.  How  soon  the  rest  will  be  clothed  in  cotton  fabrics 
made  by  machinery  from  American  cotton,  therefore,  depends  but 
little  on  whether  the  wages  of  the  Lowell  factory  girl  be  $4  or  $6 
per  week,  but  rather  on  what  exchangeable  products  the  Chinese 


322  SELECTIONS. 

can  produce  better  or  cheaper  than  we  can.  The  more  tea,  silk, 
sugar,  and  other  commodities  we  buy  from  them,  the  more  cot- 
ton fabrics  and  other  products  in  which  we  excel  will  they  buy 
from  us. 

It  has  been  held  that  the  cotton  of  America  must  be  more  and 
more  used,  both  in  America  and  elsewhere,  and  that,  as  time 
goes  on,  almost  every  other  kind,  with  the  exception  of  the  cotton 
of  Egypt,  must  give  place  to  it.  To  what  extent  may  the  same 
preeminence  be  secured  for  the  cotton  fabrics  of  the  United  States 
in  the  markets  of  the  world  that  we  have  secured  in  respect  to  the 
cotton  fibre  ? 

In  the  consideration  of  this  branch  of  the  subject,  our  attention 
must  be  given  to  the  present  condition  of  competition  between  the 
mills  of  the  Middle  and  Eastern  States  with  the  mills  of  Great 
Britain. 

In  respect  to  the  Eastern  States  the  cotton  factories  of  Lowell  in 
Massachusetts,  Manchester  in  New  Hampshire,  Biddeford  and 
Lewiston  in  Maine,  may  be  considered  in  their  relation  to  the 
factories  of  Manchester,  Stockport,  Preston,  and  Bolton,  in  Eng- 
land. For  the  purposes  of  this  comparison  it  may  be  assumed, 
that  there  can  be  no  permanent  advantage  of  one  set  of  mills 
over  the  other  in  respect  to  the  quality  and  perfection  of  the 
machinery.  At  any  given  time  some  advantage  may  be  claimed 
and  admitted  on  either  side  in  some  special  department  of  the 
mill ;  but  every  invention  or  improvement  will  sooner  or  later 
be  adopted  on  both  sides,  and  the  supremacy  in  the  art  of  convert- 
ing cotton  into  cloth  must  ultimately  fall  to  that  country  or  section 
which  possesses  the  advantage  in  respect  to  the  conditions  offered 
to  the  operatives  and  in  proximity  to  the  source  of  the  raw 
material. 

The  best  conditions  of  life  for  the  operatives,  and  the  best  pros- 
pects of  improving  their  condition  and  that  of  their  children,  are 
of  the  gravest  importance.  The  factors  in  this  problem  are 
education,  shelter,  subsistence,  and  opportunity  for  other  kinds 
of  work.  In  respect  to  education,  the  common-school  system  of 
the  United  States  assures  a  thorough  training  free  of  cost,  and  in 
the  principal  towns  and  cities  free  education  is  carried  to  the 
point  of  preparing  the  pupil  to  enter  a  university. 

In  respect  to  subsistence,  the  factories  of  New  England  are 
3,000  miles  nearer  the  wheat-fields  and  grazing-grounds  of  the 
West  than  those  of  Lancashire ;  and,  so  long  as  Europe  buys 


U.    S.    COTTON   MANUFACTURES.  323 

food  of  America,  our  own  mills  must  have  the  advantage  of 
proximity  to  the  Western  prairies.  In  respect  to  the  rents  of 
dwelling-houses  there  cannot  long  be  any  difference,  if  there  is 
any  at  present,  because  the  materials  for  construction  are  most 
abundant  in  America.  Opportunity  for  other  work  than  that  of 
the  factory  must  continue  for  many  generations,  and  until  this 
continent  is  peopled. 

In  comparing  our  power  to  compete  with  England  we  may 
claim  advantages  of  one  kind,  and  in  comparing  with  the  nations 
of  continental  Europe  we  may  claim  advantages  of  another  kind, 
in  some  respects  of  a  different  order.  In  competition  with  Eng- 
land, it  is  often  claimed  that  our  chief  advantage  lies  in  a  certain 
alleged  versatility  and  power  of  adapting  means  to  ends,  and  in 
great  quickness  of  perception  on  the  part  of  working-people  in 
respect  to  the  advantages  to  be  gained  by  the  adoption  of  new 
processes  or  inventions.  If  we  have  this  advantage,  there  must 
be  special  causes  for  it  in  the  influences  that  are  brought  to  bear 
upon  the  operatives  and  artisans  who  do  the  work  ;  for  a  very 
large  proportion  of  them  are  foreign-born,  or  are  the  children  of 
foreign  immigrants.  Why  should  they  work  with  any  more  zeal 
or  judgment  here  than  in  the  countries  whence  they  have  come  ? 
Why  are  Irish  and  French-Canadian  factory  hands  to  be  relied  on 
for  more  steady  work,  larger  product,  better  discipline,  and  more 
cleanly  and  wholesome  conditions  of  life  than  the  operatives  of 
England,  Belgium,  and  Germany?  To  me  it  appears  evident 
that  these  advantages,  so  far  as  they  exist,  are  due  mainly  to  the 
following  circumstances :  — 

First.  Our  system  of  common  and  purely  secular  schools, 
attended  by  the  children  of  rich  and  poor  alike. 

Second.     Manhood  suffrage. 

Third.     The  easy  acquisition  of  land. 

Fourth.  The  habit  of  saving  small  sums,  induced  by  the 
establishment  of  savings-banks  throughout  the  manufacturing 
States. 

Fifth.  The  absence  of  a  standing  army,  and  the  application 
of  the  revenue  derived  from  taxes  on  the  whole  to  useful  pur- 
poses. 

In  respect  to  the  first  of  these  influences,  the  public-school  sys- 
tem, the  foreign  observer  generally  takes  notice  only  of  the  quality 


324  SELECTIONS. 

of  the  instruction  given,  and,  though  he  may  find  something  to 
praise,  he  finds  also  much  to  blame.  He  finds  in  many  cases  the 
instruction  bad  and  the  subjects  often  ill-chosen,  and  he  wonders 
at  the  misdirection  of  a  force  that  might  be  so  much  more  wisely 
applied.  What  he  fails  to  notice  is  that  the  school  itself,  entirely 
apart  from  its  instruction,  is  the  great  educator  of  the  children 
who  attend  it.  The  school  is,  first  of  all,  no  respecter  of  persons  : 
the  stupid  son  of  a  rich  man,  led  in  every  class  by  the  son  of  a 
mechanic,  cannot  in  after-life  look  down  on  him  as  an  inferior, 
whatever  the  conventional  position  of  the  two  may  be  ;  or,  if  the 
rich  man's  son  has  brains  as  well  as  fortune,  the  poor  man's  son 
can  never  attribute  to  fortune  only,  the  lead  that  he  may 
take  in  after-life.  The  school  is  thoroughly  democratic,  and 
each  pupil  learns  in  it  that  it  depends  on  himself  alone  what  place 
he  may  take  in  after-life,  and  that,  although  society  may  be  divided 
into  planes,  there  is  no  system  of  caste  and  no  barrier  in  the  way 
of  social  success,  except  the  want  of  character  and  ability  to  at- 
tain it.  The  associations  of  the  common  school  utterly  prevent 
anything  like  servility  in  the  relation  of  classes  in  after-life  ;  and 
although  it  is  sometimes  made  a  little  too  manifest  that  "  one  man 
is  as  good  as  another,  and  a  little  better,"  on  the  part  of  those 
who  are  more  eager  than  discreet  in  their  effort  to  rise,  yet,  on  the 
whole,  the  relation  of  the  various  classes,  which  must  in  the 
nature  of  things  always  and  everywhere  exist,  is  that  of  mutual 
respect,  and  anything  like  the  old-world  distinctions  of  caste  and 
rank  would  seem  about  as  absurd  to  one  as  to  the  other.  The 
common  school  is  the  solvent  of  race,  creed,  nationality,  and  con- 
dition. 

In  another  way,  the  discipline  of  the  school  affects  the  processes 
of  manufacture.  In  the  schools,  cleanliness,  order,  and  regular 
habits  are  enforced,  with  deference  to  the  teachers  and  respect  for 
authority ;  and,  in  these  later  years,  this  is  coupled  with  the 
teaching  of  music  and  drawing  in  all  the  principal  towns  and 
cities.  When  children  thus  trained  are  removed  to  the  mill  or 
the  workshop,  habits  of  order  and  cleanliness,  with  some  aesthetic 
taste,  are  already  established.  Nothing  strikes  an  American 
manufacturer  with  so  much  surprise,  as  the  extreme  untidiness  of 
the  large  textile  mills  of  England  and  the  dreariness  of  the  factory 
towns.  In  this  respect,  however,  it  must  be  confessed  that  the 
managers  of  the  New  England  mills  are  greatly  aided  by  the  ab- 
sence of  smoke,  the  coal  commonly  used  being  anthracite.  Much 


U.    S.   COTTON   MANUFACTURES.  325 

surprise  is  often  expressed  by  our  foreign  visitors,  at  the  amount 
of  decoration  permitted  in  the  fitting  of  stationary  and  locomotive 
engines  and  in  much  of  our  machinery ;  but,  bad  as  the  taste  dis- 
played may  sometimes  be,  it  is  nevertherless  a  fact  that  such 
engines  or  machines  are  better  cared  for  and  kept  in  better  repair 
tjian  where  no  individuality,  so  to  speak,  is  permitted.  On  one 
of  our  great  railways  the  attempt  was  not  long  since  made  to  dis- 
patch the  locomotives  as  they  happened  to  arrive  at  the  central 
station,  sometimes  with  one  and  sometimes  with  another  engine- 
driver  ;  but  the  immediate  and  great  increase  in  the  repair  account 
caused  the  corporation  to  return  very  soon  to  the  customary  plan, 
of  giving  each  driver  a  particular  locomotive,  with  which  he  may 
be  identified. 

The  instruction  of  the  school  also  gives  every  pupil  a  superficial 
knowledge,  if  no  more,  of  the  geography  and  resources  of  the 
country,  which  the  universal  habit  of  reading  newspapers  keeps 
up.  Hence  comes  the  almost  entire  absence  of  any  fixed 
character  in  the  labor  of  the  country  :  every  boy  believes  that  he 
can  achieve  success  somewhere  else,  if  not  at  home.  No  conges- 
tion of  labor  can  last  long.  The  war  and  the  succeeding  railway 
mania  combined,  concentrated  population  at  certain  points  to  a 
greater  extent  than  ever  happened  before,  and  it  has  taken  more 
than  five  years  to  overcome  the  difficulty  ;  but  within  these  five 
years  a  million  or  more  new  inhabitants  in  Texas,  half  a  million 
or  more  in  Kansas,  and  probably  two  or  three  millions  added 
to  the  population  of  Nebraska,  Colorado,  Minnesota,  and  the 
far  North-west,  indicate  that  the  evil  has  already  found  a 
remedy. 

It  is  already  apparent  that  a  very  slight  increase  in  the  demand 
for  skilled  workmen  in  certain  branches  of  employment  would 
not  easily  be  met  in  the  Eastern  States,  except  by  drawing  upon 
England  and  Germany.  During  the  years  of  depression,  the 
cessation  of  railway  building  and  the  use  of  the  excess  of  railway 
plant  existing  in  1873  has  caused  the  dispersion  of  a  large  por- 
tion of  the  trained  mechanics  and  artisans  who  then  did  the  work 
of  supplying  this  demand  ;  but  these  are  not  the  men  who  have 
crowded  the  Eastern  cities  and  caused  the  apparent  excess  of 
laborers  out  of  work.  Such  men  have  gone  back  to  the  land,  or 
in  the  new  States  and  Territories  have  found  other  ways  in  which 
to  apply  their  skill  and  energy,  and  they  will  not  return.  It  may 
be  that  the  greatest  danger  to  the  manufacturers  of  England  will 


326  SELECTIONS. 

not  be  in  our  competition  in  the  sale  of  goods  in  neutral  markets, 
but  in  our  competition  for  the  skilled  workmen  and  artisans  who 
make  these  goods,  when  we  offer  them  equal  or  higher  wages 
and  better  conditions  of  life  in  the  work  that  will  very  soon 
need  to  be  done  to  supply  the  increasing  demand  in  our  own 
country. 

The  patent  system  may  here  be  cited  also  as  a  factor  in  our  in- 
dustrial system.  It  has  been  carried  to  an  almost  absurd  extreme, 
so  that  it  is  not  safe  for  any  one  to  adopt  a  new  method,  machine, 
or  part  of  a  machine,  and  attempt  to  use  it  quietly  and  without 
taking  out  a  patent,  lest  some  sharp  person,  seeing  it  in  use  and 
not  published,  shall  himself  secure  a  patent  and  come  back  to  the 
real  inventor  with  a  claim  for  royalty. 

Manhood  suffrage,  subject  as  it  is  to  great  abuses,  and  difficult 
as  it  has  made  the  problem  of  the  self-government  of  great  cities, 
where  voters  do  not  meet  each  other,  as  in  the  town-meeting, 
face  to  face,  but  where  the  powers  of  government  are  of  necessity 
delegated  to  men  of  whom  the  voters  can  have  little  personal 
knowledge,  yet  works  distinctly  in  the  direction  of  the  safety, 
stability,  and  order  of  the  community.  Outside  of  two  or  three 
of  the  very  largest  cities,  where  there  are  concentrated  great 
masses  of  illiterate  citizens,  it  would  be  difficult  to  find  a  case  of 
serious  abuse  of  the  power  of  taxation,  except  in  the  South  since 
the  war,  and  even  there  the  evil  is  now  mainly  abated. 

The  easy  acquisition  of  land  throughout  the  country,  under 
simple  forms  of  conveyance,  registered  in  every  county,  gives  a 
motive  to  economy,  and  induces  habits  of  saving  that  are  of 
supreme  importance  in  their  effect  on  society.  In  the  town  in 
which  I  live, —  and  in  which  I  can  remember  the  coming  of  the  first 
Irishman  who  became  a  land-owner,  —  out  of  about  one  thousand 
owners  of  real  estate,  over  two  hundred  are  of  Irish  birth  or  ex- 
traction. The  richest  one  among  them  came  from  Ireland  in 
1846,  a  steerage  passenger.  He  now  pays  taxes  on  property  of 
the  value  of  $50,000,  almost  all  in  real  estate.  His  son  is  super- 
intendent of  the  repairs  of  highways,  and  is  one  of  the  most  effi- 
cient members  of  the  school  committee. 

During  the  last  thirty  years  the  factory  population  of  New 
England  has  passed  through  three  phases.  First  came  the  sons 
and  daughters  of  the  New  England  farmer ;  but  as  the  sewing- 
machine  and  other  inventions  opened  new  demands  for  women's 
work,  women  of  American  birth  passed  out  to  easier  or  better- 


U.    S.   COTTON   MANUFACTURES.  327 

paid  employment,  while  the  men  took  up  other  branches  requir- 
ing more  individual  skill.  These  places  were  taken  mainly  hy 
Irish,  with  a  few  Germans  and  English.  But  as  the  Irish  saved 
their  earnings,  and  as  the  New  England  yeomen  emigrated  to  the 
richer  lands  of  the  great  West,  they  passed  out  of  the  mills  to  buy 
up  the  deserted  farms  of  the  poorer  North-eastern  States,  where, 
by  their  persistent  industry  and  manual  labor,  they  achieved  suc- 
cess and  gained  a  position  which  satisfied  them,  but  with  which 
the  native  New  Englander  is  no  longer  contented.  Their  places 
in  the  mills  are  now  being  more  and  more  taken  by  the  French 
Canadians,  who,  in  their  new  conditions  and  surroundings,  show 
little  of  the  stolid  and  unprogressive  character  which  has  kept 
them  so  long  contented  on  their  little  strips  of  land  on  the  Saint 
Lawrence  River.  In  the  very  air  they  breathe  they  seem  to  im- 
bibe a  new  and  restless  energy,  while  the  intelligence  shown  by 
their  children  in  the  schools  augurs  well  for  their  future  progress. 
On  the  whole  the  simplicity  of  our  system  of  land  tenure,  and 
the  ease  with  which  small  parcels  may  be  obtained,  must  be  rated 
among  the  most  important  factors  in  considering  our  possible  ad- 
vantage over  other  countries. 

Next  in  our  list  comes  the  savings-bank.  In  1875,  out  of  the 
1,652.000  inhabitants  of  Massachusetts,  720,000  were  depositors 
in  savings-banks  to  the  amount  of  $238,000,000.  During  the 
late  years  of  depression  the  deposit  has  decreased  somewhat  in 
amount,  but  the  decrease  has  been  chiefly  owing  to  the  with- 
drawal of  money  for  other  investment,  especially  in  United  States 
bonds.  There  have  been  some  failures  of  banks  and  some  losses, 
as  might  well  have  been  expected,  but  they  have  been  less  than 
in  any  other  branch  of  business  ;  and  the  savings-bank  system 
stands  firmly  based  on  well-earned  confidence,  and  offers  an  easy 
means  of  saving  the  smallest  sums  to  every  man,  woman,  and 
child  in  the  State.  At  the  present  time  the  deposits  in  the  sav- 
ings-banks of  Massachusetts  amount  to  about  $240,000,000,  owned 
by  about  750,000  persons. 

To  these  causes  of  quick  adaptation  to  any  conditions  that  may 
arise,  or  to  any  necessity  for  the  application  of  new  methods  or 
devices,  may  be  added  the  custom,  which  has  almost  the  force  of 
law,  of  an  equal  distribution  of  estates  among  the  children  of  the 
testator.  Tools  to  him  who  can  use  them  is  the  unwritten  law  ; 
and  neither  land  nor  capital  can  remain  long  in  the  possession  of 
him  who  cannot  direct  or  use  them  wisely.  Liberty  to  distribute 


328  SELECTIONS. 

is  esteemed  as  important  a  factor  in  our  body-politic  as  liberty  to 
accumulate,  even  though  the  liberty  may  sometimes  lead  to  the 
apparent  waste  of  great  fortunes. 

Finally,  it  must  be  held  that  our  freedom  from  the  blood-tax  of 
a  standing  army,  and  the  fact  that  the  proceeds  of  taxation  are, 
on  the  whole,  usefully  and  productively  expended,  are  among  our 
greatest  advantages  ;  and  this  is  asserted  with  confidence,  notwith- 
standing the  misgovernment  of  some  great  cities  and  of  several  of 
the  Southern  States.  What  are  these  failures  but  proofs  of  the 
general  confidence  of  the  people  in  local  self-government?  Great 
frauds  and  great  abuses  can  only  happen  where  integrity  is  the 
common  rule;  and  where  each  man  distrusts  his  neighbor,  or 
each  town,  city,  or  State  distrusts  the  next,  the  opportunity  for 
fraud  or  breach  of  trust  cannot  occur.  The  use  of  inconvertible 
paper  money  during  many  years  has  not  been  without  its  neces- 
sary malign  result  upon  the  character  of  the  people,  and  the  news- 
papers are  filled  with  the  fraud  and  corruption  that  have  come  to 
light;  but  no  newspaper  has  ever  yet  recorded'one  fact  that  off- 
sets many  frauds:  In  the  great  Boston  fire,  one  of  the  Boston 
banks  lost  not  only  every  book  of  account,  but  every  security  and 
note  that  was  in  its  vaults,  amounting  to  over  $1,250,000.  On 
the  morning  after  the  fire,  its  officers  had  no  evidence  or  record  by 
which  any  of  the  persons  or  corporators  who  owed  it  money  could 
be  held  to  their  contracts  ;  yet,  within  a  very  short  time,  duplicate 
notes  were  voluntarily  brought  in  by  its  debtors,  many  of  whom 
knew  not  whether  they  could  ever  pay  them,  because  the  fire  had 
destroyed  their  own  property,  and  the  known  ultimate  loss  of  that 
bank  from  the  burning  of  its  books  and  securities  was  less  than 
$10,000. 

Our  army  is  but  a  border  police.  Although  its  officers  are 
held  in  honor  and  esteem,  military  life  is  not  a  career  that  very 
many  seek,  and  as  time  goes  on  it  will  become  an  occupation  less 
and  less  to  be  desired.  Thus  we  are  spared  not  only  the  tax  for 
its  support,  but  the  worse  tax  of  the  withdrawal  of  its  members 
from  useful  and  productive  pursuits.  It  is  in  this  respect  that  we 
claim  our  greatest  advantage  over  the  nations  of  continental 
Europe.  What  have  we  to  fear  from  the  competition  of  Ger- 
many, if  we  really  undertake  to  beat  her  in  the  neutral  markets, 
which  we  can  reach  as  readily  as  she  can  ?  For  a  little  while,  the 
better  instruction  of  the  merchants  in  her  technical  and  commer- 
cial schools  may  give  her  advantage ;  but  that  can  be  overcome  in 


U.    S.    COTTON   MANUFACTURES.  329 

a  single  generation,  or  as  soon  as  the  need  is  felt  with  us,  as  it  is 
now  beginning  to  be  felt.  After  we  shall  have  supplied  our 
present  want  of  technical  education,  the  mere  difference  between 
the  presence  of  a  great  army  on  her  soil  and  its  necessary  support, 
and  the  absence  of  such  a  tax  on  us,  will  constitute  the  difference 
on  which  modern  commerce  turns.  When  the  traffic  of  the  world 
turns  on  half  a  cent  a  yard,  a  cent  a  bushel,  or  a  half-penny  a 
pound  on  the  great  staples,  no  nation  can  long  succeed  in  holding 
a  traffic  that  is  handicapped  with  a  standing  army.  The  protec- 
tion of  Germany  from  our  competition  in  neutral  markets  may  be 
offset  in  our  yet  more  dangerous  competition  for  men.  The  Ger- 
man already  knows  Texas,  and  in  the  one  block  of  60,000  square 
miles  of  land  by  which  the  State  of  Texas  exceeds  the  area  of  the 
German  empire,  we  offer  room  and  healthy  conditions  of  life  for 
millions  of  immigrants  ;  and,  if  they  come  in  sufficient  numbers, 
they  can  raise  on  that  single  square  of  land  as  much  cotton  as  is 
now  raised  in  the  whole  South,  that  is  to  say,  5,000,000  bales  ;  and 
as  much  wheat  as  is  now  raised  in  the  whole  North,  that  is  to  say, 
400,000,000  bushels,  and  yet  subsist  themselves  beside  on  what 
is  left  of  this  little  patch  that  will  not  be  needed  for  these  two 
crops. 

It  will  be  obvious  that  even  the  least  imaginative  cannot  but  be 
moved  by  the  influences  that  have  been  designated,  and  that  versa- 
tility and  readiness  to  adopt  every  labor-saving  device  will  not 
only  be  promoted,  but  will  be  absolutely  forced  into  action,  when 
such  vast  areas  are  to  be  occupied,  and  when  even  the  dullest  boy 
is  educated  in  the  belief  that  he  also  is  to  be  one  of  those  who  are 
to  build  up  this  nation  to  the  full  measure  of  its  high  calling.  We 
may  not  dare  to  boast,  in  view  of  all  we  have  passed  through  ; 
but  we  know  that  slavery  has  been  destroyed,  and  that  the  nation 
lives  stronger,  truer,  and  more  vigorous  than  ever  before.  We 
know  that  it  has  been  reserved  for  a  democratic  republic  to  be  the 
first  among  nations  that,  having  issued  government  notes  and 
made  them  a  legal  tender,  has  resumed  payment  in  coin  without 
repudiation  or  reduction  of  the  promise.  We  know  that  we  have 
paid  nearly  a  half  of  our  great  national  debt  already,  and  that  the 
rest  is  now  mainly  held  by  our  own  citizens.  We  believe  that 
within  the  lives  of  men  of  middle  age  now  living,  the  nation  will 
number  one  hundred  millions,  and  that,  in  whatever  else  we  may 
be  found  wanting,  we  cannot  long  be  kept  back  in  our  career 
of  material  prosperity,  which  shall  be  shared  with  absolute  cer- 


330  SELECTIONS. 

tainty  by  every  one  who  brings  to  the  work  health,  integrity,  and 
energy. 

If  there  is  any  force  in  this  reasoning,  our  competition  with 
other  manufacturing  countries,  in  the  supplying  of  neutral  markets 
with  manufactured  goods,  wilt  not  be  compassed  by  the  low  rates 
of  wages  paid  to  our  factory  operatives  or  to  the  working-people 
engaged  in  our  metal  works  and  other  occupations,  but  first  by 
obtaining  and  keeping  such  an  advanced  position  in  the  applica- 
ti6n  and  use  of  improved  tools  and  machinery,  as  shall  make  high 
wages  consistent  with  a  low  cost  of  production  ;  secondly,  by  our 
ability  to  obtain  the  raw  materials  at  low  cost.  Every  employer 
knows  that  among  employe's  who  are  paid  by  the  piece,  it  is  the 
operative  that  gains  the  largest  earnings  whose  production  costs 
the  least,  because  under  the  control  of  such  operatives  the  machin- 
ery is  most  effectively  guided  during  working  hours.  As  it  is 
with  single  operatives,  so  it  is  with  large  masses ;  if  well  in- 
structed, and  working  under  the  incentives  to  industry  and  frugal- 
ity that  have  been  named,  their  large  product  will  earn  for  them 
ample  wages,  and  yet  result  in  a  low  cost  of  labor  to  the  employer. 
Such  workmen  never  have  any  "  blue  Monday."  The  work- 
man who  in  this  country  habitually  becomes  intoxicated  is  soon 
discharged,  and  his  place  is  filled  by  one  who  respects  him- 
self and  values  his  place  too  much  to  risk  his  position  in  dis- 
sipation. 

Competition  with  England  in  supplying  the  markets  of  Asia, 
Africa,  and  South  America  with  cotton  goods,  is  now  perhaps  the 
best  criterion  by  which  to  gauge  our  ability  to  compete  in  other 
branches  of  manufacture.  It  has  been  often  assumed  in  England, 
that  the  increasing  shipments  of  cotton  goods  from  this  country 
have  been  forced  by  necessity,  and  merely  consisted  of  lots  sold 
below  cost,  as  a  means  of  obtaining  ready  money  ;  but  there  is  no 
ground  whatever  for  this  general  assumption,  even  though  some 
small  shipments  may  have  been  made  at  first  with  this  view.  Our 
export  of  cotton  fabrics  amounts  as  yet  to  but  7  or  8  per  cent,  of 
our  production,  and  is  but  a  trifle  compared  to  that  of  Great 
Britain  ;  but  it  is  not  made  at  a  loss,  and  it  constitutes  a  most  im- 
portant element  in  the  returning  prosperity  of  our  cotton-mills. 
The  goods  exported  are  mostly  made  by  strong  and  prosperous 
corporations,  paying  regular  dividends,  and  consist  mainly  of. 
coarse  sheetings  and  drills,  which  are  sold  by  the  manufacturers 
to  merchants,  who  send  them  to  China,  Africa,  and  South  America 


U.    S.    COTTON   MANUFACTURES.  33.1 

in  payment  for  tea,  silk,  ivory,  sugar,  gums,  hides,  and  wool. 
They  are  not  made  by  operatives  who  earn  less  than  the  recent  or 
present  rates  of  wages  in  England,  but  in  most  departments  of  the 
mills  by  those  who  earn  equal  wages,  or  even  more.  This  coin- 
petition  had  been  fairly  begun  before  the  late  war  in  this  country, 
but  it  is  now  continued  under  better  conditions.  The  mills  of 
New  England,  owing  to  through  connections  by  rail,  are  now 
relatively  much  nearer  the  cotton-fields  than  they  were  then. 
Prior  to  1860  substantially  all  the  cotton  went  to  the  seaports  of 
the  cotton  States,  and  from  there  the  cost  of  moving  it  to  the  North 
or  to  Liverpool  varied  but  little ;  but  at  the  present  day  a  large 
and  annually-increasing  portion  of  the  cotton  used  in  the  North  is 
bought  in  the  interior  markets,  and  is  carried  in  covered  cars 
directly  to  the  mills,  where  the  bales  are  delivered  clean,  and 
much  more  free  from  damage  and  waste  than  those  which  are 
carried  down  the  Southern  rivers  on  boats  and  barges,  dumped 
upon  the  wharves,  and  then  compressed  to  the  utmost  for  ship- 
ment by  sea. 

In  proof  that  this  advantage  is  an  actual  one,  the  following 
example  may  be  cited  :  A  contract  has  just  been  made  for  the 
transportation  of  a  large  quantity  of  cotton  from  Texas  to  Liver- 
pool at  the  rate  of  $[.io  per  100  pounds,  the  proportion  assigned 
to  the  land  carriage  being  70  cents,  to  transshipment  in  Boston 
and  to  the  steamship  40  cents  ;  the  rate  of  marine  insurance  is 
three-eighths  of  i  per  cent.,  and  the  cost  of  handling  in  Liverpool, 
and  transportation  to  Manchester,  not  less  than  a  quarter  of  a 
cent  per  pound.  Bargains  may  be  made  to  bring  cotton  from  the 
same  point  in  Texas  to  the  principal  factory  cities  of  New  England 
at  the  rate  assigned  to  the  land  carnage,  namely  70  cents  per  100 
pounds.  This  cotton  is  brought  from  the  interior  towns  of  Texas 
to  Boston,  and  cannot  be  carried  to  Liverpool  by  -way  of  Galves- 
ton  or  New  Orleans  so  cheaply,  else  it  would  not  come  this  way. 
Assuming  the  bale  to  weigh  500  pounds,  at  10  cents  a  pound,  we 
have  the  following  comparative  cost :  — 


332  SELECTIONS. 


LOWELL. 

Per  bale.  Per  cwt. 

Cost  of  cotton  in  Texas,  500  pounds,  at  10 

cents,  including  all  local  charges  .  .  $50  oo 

Freight  to  Lowell  in  a  covered  locked  car,  in 
which  the  cotton  is  protected  from  rain, 
mud,  and  other  causes  of  waste,  at  70  cents 
per  roo  pounds 35° 


Total $53  50         $10  70 


LANCASHIRE. 


500  pounds,  at  10  cents,  including  all  local 

charges $50  oo 

Freight  from  Texas  to  Liverpool,  at  $1.10 

per  loo  pounds  .  .  .  .  .  55° 
Insurance  at  three- eighths  of  i  [per  cent,  on 

$56 21 

Transshipment  in  Liverpool,  and  freight  to 

Lancashire,  one-fourth  of  a  cent        .         .          i   25 


Total ,         .     $56  96  ii  39 

Advantage  of  Lowell  over  Lancashire  .         .       $3  46          $o  69 


There  may  be  changes  in  the  rates,  but  it  does  not  seem  prob- 
able that  the  relation  of  the  land  to  the  ocean  rate  can  be  much 
changed,  and  it  would  therefore  appear  that  the  New  England 
manufacturer  will  have  a  permanent  advantage  in  the  price  of 
American  cotton  of  any  given  grade,  varying  from  6  to  8  per  cent, 
as  the  price  of  cotton  may  vary  from  12  to  9  cents  per  pound  ;  and 
this  advantage  may  be  equal  to  15  or  25  per  cent,  in  ability  to 
pay  wages,  as  the  cost  of  labor  varies  from  a  quarter  to  a  third 
in  the  total  cost  of  coarse  and  medium  goods,  such  as  constitute 
the  chief  part  of  the  demand  of  the  world. 

It  maybe  said  that  this  proves  too  much,  and  that  the  cotton  spin- 
ners of  the  Southern  States  will  have  the  same  relative  advantage 
over  New  England.  Let  this  be  freely  admitted  :  We  are  treating 
the  question  of  the  future  supremacy  of  the  United  States  in  the 
manufacture  as  well  as  in  the  growth  of  cotton,  and  if  the  future 


U.    S.    COTTON   MANUFACTURES.  333 

changes  in  population,  wealth,  and  condition  of  the  different  sec- 
tions of  this  country  shall,  in  the  future,  cause  the  increase  of 
spindles,  especially  in  coarse  fabrics,  to  be  planted  in  the  healthy 
hill  country  of  northern  Georgia,  eastern  Tennessee,  and  the 
Carolinas,  it  will  simply  be  the  greater  evidence  that  natural  laws 
are  paramount.  If  Georgia  has  twice  the  advantage  over  Lanca- 
shire that  New  England  now  possesses  it  will  only  be  the  fault 
of  the  people  of  Georgia  if  they  do  not  reap  the  benefit  of  it. 

It  has  been  stated  that  our  present  rates  of  wages  in  our  cotton 
factories  are  higher  than  they  were  in  1860,  and  with  our  in- 
creasing prosperity  they  will  tend  to  advance ;  but  at  the  same 
time  the  cost  of  the  labor  in  the  finished  fabric  has  been  reduced 
by  the  greater  productive  power  of  the  machinery.  The  fabrics 
upon  which  by  far  the  largest  part  of  the  spindles  and  looms  of 
the  country  are  operated,  may  be  divided  substantially  into  the 
following  classes :  — 

1.  The  printing-cloth,    28    inches   wide   and  7   yards   to   the 
pound.     The  cost  of  mill   labor  in   making  this  fabric,  including 
the  salaries,  wages,  or  earnings  of  every  one  employed,  is  now 
less  than  one  cent,  or  a  half-penny,  a  yard. 

2.  The   heavy  sheeting,  36  inches  wide,  and   the  heavy  drill, 
30  inches  wide,  each  weighing  from  2^  to  3  yards  to  the  pound. 
The  cost  of  mill  labor  in  making  these  fabrics  is  about  i^  cents 
per  yard. 

3.  Shirtings  and  sheetings,  30  to  36  inches  wide,  Nos.  20  to  30 
yarns,  each  weighing  from  3  to  4  yards  to  the  pound.     The  cost 
of  mill  labor  in  these  goods  is  from  i^  to  2  cents  per  yard. 

4.  The  fine  sheeting  or  shirting,  from  30  to  40  inches  wide, 
Nos.  30  to  40  yarns,   weighing  from^  to  4  yards  to  the  pound. 
The  cost  of  mill  labor  in  these  goods  is  from  i^  to  3  cents  per 
yard. 

5.  Fabrics  of  a  similar  kind  to  the  above,  from  i  to  3  yards  wide. 

6.  Heavy  cotton    duck,    cotton  grain-bags,    cotton   hose,    and 
other  special  articles. 

7.  Blue  denims,  stripes,  tickings,  brown  denims  and  duck,  and 
other  heavy  colored  goods,  substantial  ginghams,  cottonades,  and 
other  fancy  woven  fabrics  of  medium  or  heavy  weight. 

These  seven  classes  comprise  more  than  95  per  cent,  of  our 
cotton  fabrics  in  weight ;  to  them  are  to  be  added  lawns,  woven 
fabric  of  light  weight  for  dresses,  and  spool-cotton. 


334  SELECTIONS. 

In  respect  of  one-half  of  these  fabrics,  being  those  of  the  heavier 
grade,  our  proximity  lo  the  cotton-field,  computed  at  not  less  than 
half  a  cent  per  pound,  oftener  three-quarters,  will  enable  the  New 
England  manufacturer  to  pay  from  15  to  20  per  cent,  higher 
wages  and  yet  to  make  the  goods,  other  things  being  equal,  at  the 
same  cost  as  his  competitor  in  Lancashire.  On  a  large  portion 
of  the  other  kinds  this  advantage  in  the  cost  of  cotton  would  be 
from  10  to  15  per  cent. 

The  natural  advantages  cannot  work  immediate  results  ;  the 
ways  and  means  of  a  great  commerce  cannot  be  improvised  in  a 
year,  hardly  in  a  generation.  Much  depends  on  the  wisdom  of 
our  legislators  in  framing  the  acts  under  which  our  taxes  are 
collected,  whether  customs  or  excise,  and  yet  more  upon  our 
adherence  to  a  specie  basis  in  our  currency  ;  but  in  the  long  run 
the  only  reason  why  we  shall  not  assume  a  constantly-increasing 
share  in  the  cotton  manufacture  of  the  world  will  be  the  free 
choice  that  our  country  offers  for  other  occupations  of  a  more 
profitable  or  more  desirable  kind. 

Reference  has  been  made  to  the  small  proportion  of  fine  spin- 
ning in  the  United  States.  Within  the  last  few  years  great  prog- 
ress has  been  made  in  spinning  and  weaving  fabrics  of  Nos.  60 
to  100,  such  as  lawns  and  fine  dress  goods,  and  also  in  spinning 
fine  yarn  for  spool-cotton.  In  the  latter  direction  yarns  as  fine  as 
No.  120  are  now  spun  on  the  ring  spinning-frame,  a  machine 
invented  in  this  country  and  more  used  than  any  other  for  warp 
spinning,  and  now  being  adopted  in  Europe.  Yarns  as  fine  as  550 
are  spun  on  mules  for  three-cord  sewing-cotton,  and  for  experi- 
ment much  finer  counts  have  been  reached.  It  has  often  been  alleged 
that  fine  yarns  could  not  be  as  well  spun  in  the  United  States,  as 
in  England,  owing  to  the  dry  and  electrical  conditions  of  the 
atmosphere  during  a  considerable  part  of  the  year.  This  difficulty 
has  existed  in  some  degree,  although  not  so  as  to  preclude  fine 
work  if  it  had  been  profitable  to  undertake  it ;  but  as  far  as  this 
difficulty  existed  it  has  lately  been  entirely  removed  by  the  inven- 
tion of  a  very  simple  and  inexpensive  apparatus  for  moistening 
the  air  with  the  finest  spray  of  pure  cold  water,  by  which  method 
the  air  of  a  spinning  or  weaving-room  may  be  kept  at  any  desired 
degree  of  humidity  in  the  driest  day,  so  that  the  adverse  effect 
of  electricity  is  entirely  overcome. 

Whenever  the  condition  and  extension  of  our  market  will  war- 
rant the  undertaking,  there  is  now  no  obstacle  to  our  manufactur- 


U.   S.   COTTON  MANUFACTURES.  335 

ing  any  variety  of  cotton  fabric  that  is  in  demand,  either  coarse 
or  fine. 

While  it  may  not  be  worth  while  to  give  historical  statistics  in 
relation  to  the  cotton  manufacture  of  this  country  in  the  pres- 
ent report,  a  few  words  may  well  be  devoted  to  changes  in  the 
work,  which  have  conduced  not  only  to  the  welfare  of  the  people, 
but  to  the  welfare  of  the  operatives  also. 

When  the  cotton  manufacture  was  first  established  in  the 
United  States  water-power  was  considered  essential  to  the  work, 
and,  as  a  rule,  the  location  of  mills  was  limited  to  narrow  valleys, 
or  places  where  there  was  room  only  for  mills  of  several  stories 
in  height.  The  first  mills  built  were  very  considerable  structures 
for  their  time,  but  they  were  low-studded,  badly  lighted,  and 
were  heated  by  stoves  ;  and  in  these  mills  the  operatives  were  com- 
pelled to  work  under  arduous  conditions  (owing  to  the  imperfection 
of  the  machinery)  thirteen  to  fourteen  hours  a  day.  These  narrow 
structures  were  in  some  places  built  seven  stories  in  height.  All 
the  plans  were  made  with  reference  to  this  form  of  structure, 
whether  the  mill  was  to  be  operated  by  water-power  or  by  steam, 
until  quite  a  recent  period.  In  1860  the  "  normal"  cotton-mill 
(so  to  speak)  had  become  a  factory  four  or  five  stories  high, 
about  60  feet  wide,  varying  in  length  according  to  the  amount  of 
machinery,  high-studded,  well  lighted,  thoroughly  well  venti- 
lated, and  heated  by  radiation  from  steam-pipes. 

In  1866  the  machine  for  sizing  yarn,  known  as  the  "slasher," 
was  first  imported,  displacing  the  machine  known  as  the 
"  dresser.  "  In  the  use  of  the  slasher  one  man  and  a  boy  working 
in  a  thoroughly  well-ventilated  room,  at  a  moderate  degree  of 
heat,  took  the  place  of  seven  or  eight  men  who  had  been  previ- 
ously employed  in  the  same  work  in  a  room  which  was  of 
necessity  kept  at  over  100°  F.,  the  atmosphere  saturated  with  sour 
starch.  This  change  removed  the  only  really  objectionable  kind 
of  work  from  the  cotton  factory.  In  the  earlier  mills  the 
apparatus  for  the  removal  of  dust  from  the  factory  was  very  im- 
perfect, but  to-day  every  room,  even  including  those  in  which 
the  cotton  is  opened,  is  substantially  free  from  dust;  and  it  hap- 
pens that  the  degree  of  heat  and  of  humidity  required  for  the 
best  work  of  the  cotton  factory  is  one  which  conduces  in  great 
measure  to  the  health  of  the  operative,  perhaps  a  little  warmer 
than  may  be  desirable. 

At  the  present  time  another  change  is  in  progress.     The  use  of 


336  SELECTIONS. 

water-power  is  becoming  less,  its  development  for  the  purpose 
of  sale  having  never  proved  profitable.  The  power  thus  developed 
has  been  a  valuable  auxiliary  in  the  working  of  the  factory,  but  as 
a  matter  of  investment  the  development  of  land  and  water-power 
together  have  almost  without  exception  failed  to  be  profitable. 

The  great  progress  in  the  construction  of  the  steam-engine  and 
in  the  economy  of  fuel  is  steadily  working  towards  a  change  to 
steam  as  the  principal  motive-power  for  the  cotton  factory.  An 
incidental  advantage  in  this  change  is  that  the  factory  may  be 
placed  nearer  to  the  principal  markets,  where  it  can  be  more 
conveniently  supervised  and  more  easily  reached.  The  use  of 
steam  also  renders  a  choice  of  location  perfectly  feasible ;  and  the 
model  factory,  one  or  two  stories  high,  may  be  placed  upon  a 
level  plain,  and  can  be  more  easily  lighted  and  ventilated  and 
more  economically  operated  than  when  any  other  form  of  build- 
ing is  used.  Under  these  new  conditions  better  dwellings  for  the 
operatives,  less  crowded,  can  also  be  provided,  and  in  every 
respect  the  work  can  be  conducted  under  better  conditions. 

At  the  present  time  the  hours  of  labor  in  New  England,  where 
most  of  the  cotton  manufacturing  is  done,  vary  from  ten  to  eleven 
hours  per  day.  This  great  change  has  been  brought  about  by  a 
gradual  comprehension  of  the  best  conditions  both  for  the  laborer 
and  for  the  capitalist,  and  without  much  regard  to  legislation.  It 
is  probable  that  ere  long  ten  hours  will  be  the  limit  of  factory 
work  throughout  New  England,  either  by  process  of  legislation 
or  through  the  conviction  on  the  part  of  employers  that  any  longer 
hours  are  not  profitable,  —  a  conclusion  to  which  many  have 
already  come. 

A  great  change  has  also  in  the  progress  of  time  been  affected 
in  the  dwellings  in  which  the  factory  operatives  live,  in  part  tend- 
ing towards  better  conditions,  in  part  to  worse  conditions.  On 
the  whole  there  has  been  less  average  progress  in  this  direction 
than  in  the  construction  and  operation  of  the  mills  themselves. 
The  choice  of  position,  however,  which  is  now  given  by  the 
greater  use  of  steam,  gives  better  opportunities  for  scattering  the 
dwelling-houses  over  a  wider  area  at  little  cost. 

A  more  abundant  supply  and  choice  of  food  has  been  effected  in 
this  as  in  all  other  branches  of  work,  to  the  great  benefit  of  the 
operatives,  by  the  consolidation  and  more  effective  service  of 
railroads.  The  average  work  of  a  male  operative  over  sixteen 
years  of  age  in  textile  factory  will  earn  enough  in  a  day  to  pay  for 


U.    S.    COTTON   MANUFACTURES.  337 

the  transportation  of  meat  and  bread  for  one  year,  one  thousand 
miles,  or  from  Chicago  to  Lowell,  Lawrence,  or  Fall  River.  So 
far  as  cost  is  concerned,  the  great  fields  of  the  West  and  the  fac- 
tories of  the  East  are  in  closer  proximity  than  if  the  factory  de- 
pended for  its  food  upon  its  own  immediate  neighborhood,  when 
served  only  by  wagon-roads.  The  same  changes  which  have  so 
greatly  reduced  the  railway  charges  between  East  and  West  are 
now  taking  place  between  North  and  South.  The  charge  for 
moving  cotton  is  becoming  less  year  by  year,  and  it  will  soon 
matter  little  where  the  cotton  factory  is  placed,  so  far  as  distance 
between  the  field  and  the  factory  is  concerned.  The  choice  maybe 
made  so  as  to  secure  the  stimulus  of  a  moderately  cold  climate,  in 
which  in-door  labor  is  more  to  be  desired  than  out-door,  in  which 
the  humidity  of  the  atmosphere  is  measurably  uniform  or  is  not 
subject  to  extremes,  and  where  facilities  for  repairs  on  machinery 
are  close  at  hand,  and  the  population  is  sufficiently  dense  to  assure 
an  adequate  and  constant  supply  of  operatives,  —  mills  which  are 
much  isolated  always  working  at  a  disadvantage. 

Great  changes  of  a  beneficial  kind  can  now  be  foreseen  in  the 
application  of  electricity  to  the  lighting  of  the  factory.  The  de- 
velopments in  this  direction  are  also  such,  that,  whatever  the 
relative  cost  of  the  electric  light  as  compared  to  gas  may  be,  it  is 
yet  so  beneficial  in  other  respects,  that  no  factory  manager  can 
well  afford  to  dispense  with  it,  not  only  because  of  the  more  per- 
fect work  which  its  use  assures,  but  because  the  choice  of  the 
operative  in  selecting  the  place  in  which  to  work  will  render  the 
use  of  the  electric  light  almost  a  matter  of  necessity. 

In  conclusion,  it  may  be  said  that  the  progress  in  the  art  of 
manufacturing  cotton  fabrics  in  the  last  forty  years  has  been  very 
great,  distinctly  sustaining  the  rule  which  affects  all  the  arts  to 
which  modern  machinery  can  be  applied,  namely,  that,  in  pro- 
portion to  the  effectiveness  of  capital  in  the  form  of  machinery 
and  the  freedom  with  which  it  may  be  applied,  the  cost  of  pro- 
duction is  lessened  and  the  consumer  is  served  more  cheaply ; 
while,  on  the  other  hand,  the  wages  of  the  operatives  are  in- 
creased, the  conditions  of  work  made  better,  and  the  identity  of 
interests  between  labor  and  capital  are  established. 

It  may  be  said  that  in  the  absence  of  any  artificial  obstructions 
to  traffic  between  States  or  nations,  the  truest  guide  to  the  place 
where  the  lowest  cost  of  production  is  compassed  may  be  found 
by  ascertaining  where  the  wages  of  labor  are  the  highest,  and  the 


338  SELECTIONS. 

conditions  of  life  the  best ;  that  at  that  point  the  lowest  cost  of 
production  must  be  found,  for  this  reason  :  both  wages  and  profits 
are  derived  from  the  sale  of  the  thing  produced  ;  hence  it  fol- 
lows that  where  the  natural  conditions  of  production  are  best, 
the  machinery  most  effective,  and  the  labor  the  most  intelli- 
gent and  skilful,  the  product  will  be  largest  at  the  least  effort 
to  those  who  do  the  work,  and  when  the  division  of  this 
product  is  made  under  the  conditions  of  absolutely  free  com- 
petition, the  relative  proportion  which  capital  can  secure  to  itself 
will  be  least,  even  though  its  absolute  share  be  greater  and  greater 
as  the  years  go  on  ;  but  the  share  which  the  laborer  will  receive 
will  increase  year  by  year,  both  absolutely  and  relatively.  As 
capital  increases  the  absolute  sum  of  profits  is  greater,  but  the 
relative  share  of  the  product  secured  by  capital  becomes  less. 
The  increase  of  capital  and  its  effective  use  by  skilled  laborers 
assure  a  larger  production,  and  the  workman  obtains  a  larger 
share  of  a  larger  product,  measured  in  kind  or  in  wages  paid  in 
money.  In  the  cotton-mill,  as  well  as  in  many  other  arts,  special 
skill  is  required,  but  perhaps  less  general  intelligence ;  therefore  a 
lower  grade  of  operatives  may  be  employed  from  time  to  time  as 
the  machinery  becomes  more  automatic,  but  at  a  steadily-increas- 
ing rate  of  wages.  Invention  may,  therefore,  be  said  to  enable  all 
conditions  of  men  to  attain  a  higher  plane  of  material  welfare, 
and  as  one  class  passes  from  the  factory  to  other  occupations 
which  offer  better  conditions  of  life,  new  improvements  enable 
those  who  could  not  do  the  factory  work  before,  to  undertake 
and  carry  it  on.  Thus  it  has  been  in  the  past,  since  the  farmers' 
daughters  of  New  England  left  the  factory  in  which,  with  much 
longer  hours  of  work,  they  earned  only  about  one-half  the  wages 
now  paid  ;  but  those  who  have  succeeded  them  could  not  then 
have  been  capable  of  doing  the  work  at  all  which  they  now  so 
easily  accomplish. 


U.    S.    IRON   AND   STEEL  INDUSTRIES.  339 


THE   IRON  AND    STEEL   INDUSTRIES. 

FROM    SWAKK'S    STATISTICS   OF   THE   IRON    AND    STEEL   PRODUCTION, 
TENTH  CENSUS,  VOL.  II.,  pp.  886-890. 

Important  Uses  of  Iron  and  Steel. 

The  people  of  the  United  States  are  the  largest  per  capita  con- 
sumers of  iron  and  steel  in  the  world,  and  of  all  nations  they  are 
also  the  largest  aggregate  consumers  of  these  products.  Great 
Britain  makes  more  iron  than  we  do,  but  she  exports  about 
one-half  of  all  that  she  makes.  She  exports  more  than  one-half 
of  the  steel  that  she  makes,  and  yet  makes  but  little  more  than  this 
country.  No  other  European  country  equals  Great  Britain  either 
in  the  per  capita  or  aggregate  consumption  of  iron  and  steel. 
This  country  is  not  now  producing  as  much  iron  and  steel  as  it 
consumes,  but  imports  large  quantities  of  both  products,  Great 
Britain  being  the  principal  source  of  our  foreign  supply.  Our 
exports  of  iron  and  steel  are  only  nominal. 

A  simple  enumeration  of  some  of  the  more  important  uses  to 
which  iron  and  steel  are  applied  by  our  people  will  show  how 
prominent  is  the  part  these  metals  play  in  the  development  of 
American  civilization  and  in  the  advancement  of  our  greatness 
and  power  as  a  nation.  * 

We  have  built  almost  as  many  miles  of  railroad  as  the  whole 
of  Europe,  and  consequently  have  used  in  their  construction 
almost  as  many  rails,  and  now  use  almost  as  many  railroad  cars 
and  locomotives.  At  the  close  of  1881  this  country  had  100,000 
miles  of  railroad,  Europe  had  about  106,000  miles,  and  all  the 
rest  of  the  world  had  about  45,000  miles.  The  United  States 
had  nineteen  miles  of  railroad  to  every  10,000  of  population, 
while  Europe  had  a  little  more  than  three  miles  to  the  same  pop- 
ulation. Railroads,  it  is  well  known,  annually  consume  more 
than  one-half  of  the  world's  production  of  iron  and  steel,  — rails, 
bridges,  cars,  and  locomotives  being  impossible  without  these 
metals.  The  street  railway  is  an  American  invention  which  also 
consumes  large  quantities  of  iron  and  steel,  and  we  are  far  in 
advance  of  every  other  nation  in  its  use.  We  were  also  the  first 
nation  in  the  world  to  introduce  elevated  railways  especially  to 
facilitate  travel  in  large  cities.  In  the  construction  of  our  New 
York  elevated  railways  beauty  of  design,  fitness  of  parts,  and 


340  SELECTIONS. 

strength  of  materials  have  been  so  perfectly  combined  as  to  excite 
the  admiration  of  all  who  behold  them.  We  are  the  foremost  of 
all  nations  in  the  use  of  iron  and  steel  in  bridge-building  for  rail- 
roads and  ordinary  highways,  and  the  lightness  and  gracefulness 
of  our  bridges  are  nowhere  equalled,  while  their  strength  and 
adaptability  to  the  uses  to  which  they  are  required  are  nowhere 
surpassed.  In  the  use  of  iron  for  water-pipes  and  gas  pipes  we 
are  probably  in  advance  of  every  other  nation.  We  make  more 
iron  stoves  for  heating  halls  and  dwellings  and  for  the  purposes 
of  the  kitchen  than  all  the  rest  of  the  world,  and  in  the  use  of 
heaters  and  ranges  we  are  behind  no  other  nation.  Our  house- 
hold stoves,  both  for  heating  and  cooking,  are  works  of  real  art 
as  well  as  of  utility.  Thev  are  ornaments  of  American  homes, 
instead  of  being  conveniences  simply.  Our  heating  stoves  are 
especially  handsome,  bright,  cheerful,  healthful,  and  clean.  In 
all  respects  they  form  the  best  combination  of  desirable  qualities 
yet  devised  for  the  heating  of  private  dwellings.  Cooking  and 
other  domestic  utensils  of  iron  have  always,  even  in  colonial 
days,  been  freely  used  in  American  households.  We  make 
liberal  use  of  both  cast  and  wrought  iron  in  the  construction  of 
public  and  private  buildings.  Our  use  of  iron  for  these  purposes 
has  in  late  years  been  quite  marked,  and  in  no  respect  more  so 
than  in  the  truly  artistic  effects  which  we  give  to  this  metal.  We 
probably  excel  all  nations  in  the  use  of  iron  for  ornamental  pur- 
poses in  connection  with  masonry,  brick-work,  and  wood-work. 
Fine  illustrations  of  the  artistic  combination  of  iron  with  other 
materials  may  be  seen  in  the  interior  of  the  new  State  Depart- 
ment building  at  Washington  and  in  the  interior  of  the  new  pas- 
senger depot  of  the  Pennsylvania  railroad  at  Philadelphia.  We 
lead  the  world  in  the  use  of  iron  and  steel  wire  for  fencing  pur- 
poses, and  we  have  more  miles  of  telegraph  wire  in  use  than  any 
other  country.  Barbed-wire  fencing  is  an  American  invention. 
We  have  made  creditable  progress  in  the  construction  of  iron 
ships,  and  we  would  have  made  much  greater  progress  if  the 
same  encouragement  that  has  been  given  by  other  nations  to  their 
shipping  interests  had  been  given  to  ours.  We  use  immense 
quantities  of  plate-iron  in  the  storage,  transportation,  and  refining 
of  petroleum,  in  the  production  of  which  nature  has  given  us 
almost  a  monopoly.  The  oil-wells  themselves  yearly  require 
thousands  of  tons  of  iron  pipes  for  tubing.  We  make  liberal  use 
of  plate  and  sheet  iron  in  the  construction  of  the  chimneys  of 


U.    S.    IRON   AND   STEEL   INDUSTRIES.  34! 

steamboats  on  our  lakes  and  rivers,  and  in  the  construction  of 
factory,  rolling-mill,  and  blast-furnace  chimneys,  and  the  stacks 
of  blast-furnaces.  American  planished  sheet-iron  has  almost 
entirely  superseded  Russia  sheet-iron  in  our  markets.  We  use 
it  for  locomotive  jackets,  in  the  manufacture  of  stoves  and  stove- 
pipe, and  for  many  other  purposes.  We  are  the  largest  con- 
sumers of  tin  plates  in  the  world,  —  Great  Britain,  their  principal 
manufacturer,  sending  us  annually  more  than  one-half  of  her 
whole  product.  Portable  and  stationary  engines  consume  large 
quantities  of  iron  and  steel.  Our  beautiful  steam  fire-engines  are 
the  product  of  American  taste  and  skill,  if  they  are  not  strictly  an 
American  invention,  and  we  annually  make  large  numbers  of 
them  for  home  use  and  for  exportation.  Anchors  and  chains, 
cotton-presses  and  cotton-ties,  sugar-pans  and  salt-pans,  and 
general  foundry  and  machine  work  annually  require  large  quan- 
tities of  either  iron  or  steel.  We  make  our  own  cotton  and 
woollen  manufacturing  machinery,  and  nearly  all  the  other  ma- 
chinery that  we  use.  The  manufacture  of  the  printing-presses 
of  the  country  consumes  immense  quantities  of  iron  and  steel. 
No  other  country  makes  such  free  use  of  the  printing-press  as 
this  country.  We  are  the  leading  agricultural  nation  of  the 
^world,  and  hence  are  the  largest  consumers  of  agricultural  im- 
plements ;  but  we  are  also  in  advance  of  every  other  nation  in 
the  use  of  agricultural  machinery.  Our  use  of  iron  and  steel  in 
agriculture  takes  rank  next  to  their  use  in  the  construction  and 
maintenance  of  railroads.  We  lead  all  nations  in  the  manufact- 
ure of  cut-nails  and  spikes.  Having  a  larger  and  more  rapidly 
increasing  population  than  anv  other  country  that  is  noted  for  its 
consumption  of  iron,  we  are  consequently  the  largest  consumers 
of  nails  and  spikes  in  the  construction  of  dwellings  and  public 
buildings,  stores,  warehouses,  offices,  and  similar  structures. 
Our  extended  and  varied  mining  operations  consume  iron  and 
steel  in  large  quantities.  So  do  our  manufactures  of  scales  and 
balances,  letter-presses,  burglar-proof  and  fire-proof  safes,  sew- 
ing-machines, and  wagons  and  carriages.  Sewing-machines  are 
an  American  invention.  Considerable  quantities  of  iron  or  iron 
and  steel  are  used  for  sewer  and  other  gratings,  street-crossings, 
iron  pavements,  lamp-posts,  posts  for  awnings,  all  sorts  of  small 
hardware,  horseshoes  and  horseshoe  nails,  wire-rope,  iron  hoops, 
iron  cots  and  bedsteads,  woven-wire  mattresses,  iron  screens,  iron 
railino-s,  and  fire-arms.  In  the  manufacture  of  machine  and  hand 


342  SELECTIONS. 

tools  and  general  cutlery  we  are  excelled  by  no  other  nation,  and 
in  the  use  of  machine  tools  we  are  in  advance  of  every  other 
nation.  In  general  cutlery  our  saws  and  axes  especially  enjoy  a 
world-wide  reputation.  Not  the  least  important  use  to  which 
iron  and  steel  are  put  in  this  country  is  in  the  extension  of  the 
iron  industry  itself,  —  every  blast-furnace,  rolling-mill,  or  steel 
works  that  is  erected  first  devouring  large  quantities  of  these 
products  before  contributing  to  their  general  supply. 

In  the  substitution  of  steel  for  iron  this  country  is  rapidly  pro- 
gressing, especially  in  the  construction  and  equipment  of  its 
railroads.  During  the  past  few  years  fully  two- thirds  of  all  the 
rails  that  have  been  laid  on  American  railroads  have  been  made 
of  Bessemer  steel,  and  at  present  a  still  larger  proportion  of  steel 
rails  is  required  by  our  railroad  companies.  On  several  Amer- 
ican railroads  the  boilers  of  all  new  locomotives  are  now  required 
to  be  made  of  steel,  and  the  tendency  is  toward  the  exclusive  use 
of  steel  for  locomotive  boilers,  and  its  general  use  for  stationary 
and  marine  boilers.  The  tires  of  American  locomotives  are  now 
made  exclusively  of  steel,  and  the  fire-boxes  of  our  locomotives 
are  generally  made  of  steel.  The  steel  used  in  the  construction 
of  American  locomotives  is  now  chiefly  produced  by  the  open- 
hearth  process.  We  have  built  a  few  steel  bridges,  but  there  is 
no  marked  tendency  to  substitute  steel  for  iron  in  bridge-building. 
Steel  is,  however,  largely  used  in  the  manufacture  of  wire,  in- 
cluding wire-fencing,  and  for  car  and  carriage  axles,  carriage 
tires,  fire-arms,  screws,  and  many  other  purposes.  But  little 
steel  has  yet  been  used  in  this  country  for  nails  and  horse- 
shoes. 

Mention  has  been  made  of  the  artistic  finish  of  some  of  our 
iron-work  ;  but  the  subject  seems  worthy  of  further  notice.  It  is 
not  only  in  stove-founding,  in  the  graceful  designs  of  bridges  and 
elevated  railways,  and  in  the  delicate  combination  of  iron  with 
other  materials  in  the  construction  and  ornamentation  of  build- 
ings that  American  iron-workers  have  displayed  an  exquisite  taste 
and  a  bold  and  dexterous  touch.  The  fine  arts  themselves  are 
being  enriched  by  the  achievements  of  our  ironworking  country- 
men. An  iron  foundry  at  Chelsea,  in  Massachusetts,  has  recently 
reproduced,  in  iron  castings,  various  works  of  art  with  all  the 
fidelity  and  delicacy  of  Italian  iron-founders.  The  most  delicate 
antique  patterns  have  been  successfully  copied.  Shields  repre- 
senting mythological  groups  and  classic  events,  medallions  con- 


U.    S.    IRON  AND   STEEL   INDUSTRIES.  343 

taining  copies  of  celebrated  portraits,  panels  containing  flowers 
and  animals,  an  imitation  of  a  Japanese  lacquer- tray  one-sixteenth 
of  an  inch  thick,  and  a  triumphal  procession  represented  on  a 
large  salver  comprise  some  of  the  work  of  the  Chelsea  foundry. 
Some  of  the  castings  have  been  colored  to  represent  bronze,  and 
others  to  represent  steel,  while  others  again  preserve  the  natural 
color  of  the  iron.  The  bronzed  castings  resemble  beaten  work 
in  copper.  Only  American  iron  is  used.  The  ornamental  uses 
to  which  art  castings  of  iron  may  be  put  are  many,  and  as  they 
can  be  cheaply  produced  it  may  be  assumed  that  a  demand  will 
ere  long  be  created  for  them  that  will  be  in  keeping  with  the 
artistic  taste  which  has  been  so  generally  developed  in  our  country 
during  the  past  few  years. 

We  conspicuously  fall  behind  many  other  nations  in  the  use  of 
iron  and  steel  for  military  purposes.  We  maintain  only  a  small 
standing  army  and  a  small  navy,  and  hence  have  but  little  use  for 
iron  or  steel  for  the  supply  of  either  of  these  branches  of  the 
public  service.  We  are  also  behind  many  other  nations  in  the 
use  of  iron  and  steel  sleepers  for  railway  tracks.  We  yet  have 
an  abundance  of  timber  for  railway  cross-ties,  and  hence  do  not 
need  to  substitute  either  iron  or  steel  cross-ties.  Except  possibly 
as  an  experiment,  there  is  not  an  iron  or  steel  cross-tie  in  use  in 
this  country.  It  is  a  singular  fact  that  we  still  import  many 
blacksmith's  anvils,  their  manufacture  being  a  branch  of  the  iron 
business  to  which  we  have  not  yet  given  adequate  attention. 
Anvils  of  the  best  quality  are,  however,  made  in  this  country. 
A  far  more  serious  hiatus  in  our  iron  industry  is  found  in  the 
almost  total  absence  of  the  manufacture  of  tin  plates,  the  basis  of 
which  is  sheet-iron,  as  is  well  known.  As  we  can  import  the 
crude  tin  as  easily  as  we  import  other  commodities,  our  failure 
thus  far  to  manufacture  tin  plates  must  be  ascribed  to  the  only 
true  cause,  —  our  inability  to  manufacture  sheet-iron  and  coat  it 
with  tin  as  cheaply  as  is  done  by  British  manufacturers.  It  is 
not  improbable  that  tin  ore  may  yet  be  discovered  in  our  own 
country  in  sufficiently  large  quantities  to  supply  any  domestic 
demand  that  may  be  created  for  its  use. 

CONCLUSION. — In  reviewing  the  historical  pages  of  this  report 
the  most  striking  fact  that  presents  itself  for  consideration  is  the 
great  stride  made  by  the  world's  iron  and  steel  industries  in  the 
last  hundred  years.  In  1788  there  were  only  eighty-five  blast- 
furnaces in  Great  Britain,  most  of  which  were  small,  and  their 


344  SELECTIONS. 

total  production  was  only  68,300  tons  of  pig-iron.  In  1880  Great 
Britain  had  967  furnaces,  many  of  which  were  very  large,  and 
their  production  was  7,749.233  tons.  A  hundred  years  ago  there 
were  no  railroads  in  the  world  for  the  transportation  of  freight 
and  passengers.  Iron  ships  were  unknown,  and  all  the  iron 
bridges  in  the  world  could  be  counted  on  the  fingers  of  one  hand. 
Without  railroads  and  their  cars  and  locomotives,  and  without 
iron  ships  and  iron  bridges,  the  world  needed  but  little  iron. 
Steel  was  still  less  a  necessity,  and  such  small  quantities  of  it  as 
were  made  were  mainly  used  in  the  manufacture  of  tools  with 
cutting  edges. 

The  great  progress  made  by  the  world's  iron  and  steel  indus- 
tries in  the  last  hundred  years  is  as  marked  in  the  improvement 
of  the  processes  of  manufacture  as  in  the  increased  demand  for 
iron  and  steel  products.  A  hundred  years  ago  all  bar-iron  was 
laboriously  shaped  under  the  trip-hammer  ;  none  of  it  was  rolled. 
Nor  was  iron  of  any  kind  refined  at  that  time  in  the  puddling 
furnace  ;  it  was  all  refined  in  forges,  and  much  of  it  was  made  in 
primitive  bloomary  forges  directly  from  the  ore.  Nearly  all  of 
the  blast-furnaces  of  a  hundred  years  ago  were  blown  with 
leather  or  wooden  bellows  by  water-power,  and  the  fuel  used  in 
them  was  chiefly  charcoal.  Steam-power,  cast-iron  blowing 
cylinders,  and  the  use  of  bituminous  coal  had  just  been  introduced. 
Less  than  sixty  years  ago  heated  air  had  not  been  used  in  the 
blowing  of  blast-furnaces,  and  fifty  years  ago  anthracite  coal  had 
not  been  used  in  them,  except  experimentally.  Thirty  years  ago 
the  Bessemer  process  for  the  manufacture  of  steel  had  not  been 
heard  of,  and  the  open-hearth  process  for  the  manufacture  of  steel 
had  not  been  made  a  practical  success.  Thirty  years  ago  the 
regenerative  gas  furnace  had  not  been  invented.  The  nineteenth 
century  has  been  the  most  prolific  of  all  the  centuries  in  inven- 
tions which  have  improved  the  methods  of  manufacturing  iron 
and  steel,  and  which  have  facilitated  their  production  in  large 
quantities. 

The  next  most  impoi'tant  fact  that  is  presented  in  the  historical 
chapters  of  this  report  is  the  astonishing  progress  which  the  iron 
and  steel  industries  of  the  United  States  have  made  within  the 
last  twenty  years.  During  this  period  we  have  not  only  utilized 
all  contemporaneous  improvements  in  the  manufacture  of  iron  and 
steel,  but  we  have  shown  a  special  aptitude,  or  genius,  for  the 
use  of  such  improvements  as  render  possible  the  production  of 


U.    S.    IRON  AND   STEEL   INDUSTRIES.  345 

iron  and  steel  in  large  quantities.  Enterprising  and  courageous 
as  the  people  of  this  country  have  always  been  in  the  manufacture 
of  iron  and  steel,  they  have  shown  in  the  last  twenty  years 
that  they  have  in  all  respects  been  fully  alive  to  the  iron  and 
steel  requirements  of  our  surprising  national  development.  If 
we  had  not  applied  immense  blowing  engines  and  the  best  hot- 
blast  stoves  to  our  blast-furnaces  our  present  large  production  of  pig- 
iron  would  have  been  impossible.  If  we  had  not  built  numerous 
large  rolling-mills  we  could  not  have  had  a  sufficient  supply  of 
plate-iron  for  locomotive  and  other  boilers,  the  hulls  of  iron 
ships,  oil-tanks,  nails  and  spikes,  and  other  important  uses  ;  nor 
of  sheet-iron  for  stoves  and  domestic  utensils  ;  nor  of  tee,  angle, 
and  channel  iron  for  bridge-building  and  general  construction 
purposes  ;  nor  of  iron  rails  for  our  railroads ;  nor  of  bar-iron  and 
rod-iron  for  a  thousand  uses.  If  we  had  not  promptly  introduced 
the  Bessemer  process  the  railroads  of  the  country  could  not  have 
been  supplied  with  steel  rails,  and  without  the  four  and  a  half 
million  tons  of  American  steel  rails  that  have  been  laid  down  in 
the  past  twelve  years  our  trunk  railroads  could  not  have  carried 
their  vast  tonnage  of  agricultural  and  other  products,  for  iron 
rails  could  not  have  endured  the  wear  of  this  tonnage.  If  we 
had  not  established  the  manufacture  of  crucible  steel  and  intro- 
duced the  open-hearth  process  there  would  have  been  a  scarcity 
of  steel  in  this  country  for  the  manufacture  of  agricultural  im- 
plements, springs  for  railway  passenger  cars,  tires  for  locomo- 
tives, etc.  Foreign  countries  could  not  in  late  years  have  supplied 
our  extraordinary  wants  for  pig-iron,  rolled  iron,  iron  and  steel 
rails,  and  crucible  and  open-hearth  steel,  for,  if  there  were  no 
other  reasons,  the  naturally  conservative  character  of  their  people 
would  have  prevented  them  from  realizing  the  magnitude  of  those 
wants.  If  our  iron  and  steel  industries  had  not  been  developed 
in  the  past  twenty  years  as  they  have  been  it  is  clear  that  our, 
railroad  system  could  not  have  been  so  wonderfully  extended  and 
strengthened,  and  without  this  extension  of  our  railroads  we 
could  not  have  produced  our  large  annual  surplus  of  agricultural 
products  for  exportation,  nor  could  our  population  have  been  so 
largely  increased  by  immigration  as  it  has  been. 

We  cannot  fully  comprehend  the  marvellous  nature  of  the 
changes  which  have  taken  place  in  the  iron  and  steel  industries 
of  this  country  in  recent  years,  unless  we  compare  the  early  his-- 
tory  of  those  industries  with  their  present  development. 


346  SELECTIONS. 

In  Alexander  Hamilton's  celebrated  "  Report  on  the  Subject 
of  Manufactures,"  presented  to  Congress  on  the  5th  of  December, 
1791,  just  ninety  years  ago,  it  was  stated  with  evident  satisfaction 
that  '"  the  United  States  already  in  a  great  measure  supply  them- 
selves with  nails  and  spikes,"  so  undeveloped  and  primitive  was 
her  iron  industry  at  that  time.  In  the  preceding  year,  1790, 
"  Morse's  Geography"  claimed,  in  a  description  of  New  Jersey, 
that  "  in  the  whole  State  it  is  supposed  there  is  yearly  made 
about  1,200  tons  of  bar-iron,  1,200  ditto  of  pigs,  and  80  of  nail 
rods;  "  and  in  1802  it  was  boastingly  declared  in  a  memorial  to 
Congress  that  there  were  then  150  forges  in  New  Jersey,  "  which 
at  a  moderate  calculation  would  produce  twenty  tons  of  bar-iron 
each  annually,  amounting  to  3,000  tons."  In  1880  there  were 
several  rolling-mills  in  New  Jersey  and  several  hundred  in  the 
United  States  which  could  each  produce  much  more  bar-iron  in 
a  year  than  all  of  the  150  forges  of  New  Jersey  would  produce 
in  1802. 

Less  than  fifty  years  ago  the  American  blast-furnace  which 
would  make  four  tons  of  pig-iron  in  a  day,  or  twenty-eight  tons 
in  a  week,  was  doing  good  work.  We  had  virtually  made  no 
progress  in  our  blast-furnace  pi'actice  since  colonial  days.  In 
1831  it  was  publicly  proclaimed  with  some  exultation  that  "  one 
furnace  erected  in  Pennsylvania  in  1830  will  in  1831  make  1,100 
tons  of  pig-iron."  But,  as  George  Asmus  has  well  said,  "  a  time 
came  when  men  were  no  longer  satisfied  with  these  little  smelt- 
ing-pots,  into  which  a  gentle  stream  of  air  was  blown  through 
one  nozzle,  which  received  its  scanty  supply  from  a  leather  bag, 
squeezed  by  some  tired  water-wheel."  After  1840  our  blast- 
furnace practice  gradually  improved,  but  it  was  not  until  about 
1865  that  any  furnace  in  the  country  could  produce  150  tons  of 
pig-iron  in  a  week.  Ten  years  later,  in  1875,  we  had  several 
furnaces  which  could  each  make  700  tons  of  pig-iron  in  a  week ; 
in  1880  we  had  several  which  could  each  make  1,000  tons  in  a 
week  ;  and  in  1881  we  had  one  furnace  which  made  224  tons  in 
a  day,  i,3">7  tons  in  a  week,  and  5,598  tons  in  a  month. 

In  1810,  seventy  years  ago,  we  produced  only  917  tons  of  steel, 
none  of  which  was  crucible  steel.  In  1831,  fifty  years  ago,  we 
produced  only  about  2,000  tons  of  steel,  not  one  pound  of  which 
was  crucible  steel  of  the  best  quality.  So  imperfect  were  our  at- 
tainments as  steelmakers  in  1831,  that  we  considered  it  a  cause 
of  congratulation  that  "American  competition  had  excluded  the 


U.    S.    IRON   AND   STEEL   INDUSTRIES.  347 

British  common  blister  steel  altogether."  In  I88o  we  had  virtu- 
ally ceased  to  make  even  the  best  blister  steel,  better  steel  having 
taken  its  place,  and  in  that  year  we  produced  1,247,335  gross  tons 
of  steel  of  all  kinds,  64,664  tons  of  which  was  crucible  steel. 
Our  production  of  Bessemer  steel  and  Bessemer  steel  rails  in  1880 
was  larger  than  that  of  Great  Britain. 

It  was  not  until  1844  that  we  commenced  to  roll  any  other  kind 
of  rails  than  strap  rails  for  our  railroads,  and  not  even  in  that 
year  were  we  prepared  to  roll  a  single  ton  of  T  rails.  In  1880 
we  rolled  1,305,212  gross  tons  of  rails,  nearly  two-thirds  of 
which  were  steel  rails,  and  nearly  all  of  which  were  T  rails. 

The  growth  of  the  iron  and  steel  industries  of  the  United  States 
during  the  present  century  is  perhaps  best  exemplified  in  the 
statistics  of  the  production  of  our  blast-furnaces  at  various  periods. 
In  1810  we  produced  53,908  gross  tons  of  pig-iron  and  cast-iron  ; 
in  1840  we  produced  315,000  gross  tons;  in  1860  we  produced 
821,223  gross  tons;  and  in  1880  we  produced  3,835,191  gross 
tons.  Our  production  in  1881  will  be  about  4,500,000  gross 
tons. 

The  position  of  the  United  States  among  iron  and  steel  produc- 
ing countries  in  1880  is  correctly  indicated  in  the  following  table 
of  the  world's  production  of  pig-iron  and  steel  of  all  kinds,  which 
we  have  compiled  from  the  latest  and  most  reliable  statistics  that 
are  accessible.  This  table  places  the  world's  production  of  pig- 
iron  in  1880  at  17,688,596  gross  tons,  and  the  world's  production 
of  steel  in  the  same  year  at  4,343,719  gross  tons.  The  percentage 
of  pig-iron  produced  by  the  United  States  was  nearly  22,  and  its 
percentage  of  steel  was  nearly  29, 


348 


SELECTIONS. 


f   * 


gt 

o| 


% 
I  ? 


i  1 1  $  0 1 .  S  i 

*H   °£    y    *s'  ~jr    ^   #*"   #°    £• 


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U.    S.    IRON  AND   STEEL  INDUSTRIES.  349 

Although  this  country  cannot  produce  iron  and  steel  as 
cheaply  as  European  countries  which  possess  the  advantages  of 
cheap  labor  and  proximity  of  raw  materials,  it  is  not  excelled  by 
any  other  country  in  the  skill  which  it  displays  or  the  mechanical 
and  scientific  economies  which  it  practises  in  any  branch  of  their 
manufacture,  while  in  certain  leading  branches  it  has  displayed 
superior  skill  and  shown  superior  aptitude  for  economical  im- 
provements. Our  blast-furnace  practice  is  the  best  in  the  world, 
and  it  is  so  chiefly  because  we  use  powerful  blowing-engines 
and  the  best  hot-blast  stoves,  possess  good  fuel,  and  carefully 
select  our  ores.  The  excellent  quality  of  our  pig-iron  is  univer- 
sally conceded.  Our  Bessemer  steel  practice  is  also  the  best  in 
the  world.  We  produce  much  more  Bessemer  steel  and  roll 
more  Bessemer  steel  rails  in  a  given  time  by  a  given  amount  of 
machinery,  technically  termed  a  "  plant,"  than  any  of  our  Euro- 
pean rivals.  No  controversy  concerning  the  relative  wearing 
qualities  of  European  and  American  steel  rails  now  exists,  and  no 
controversy  concerning  the  quality  of  American  Bessemer  steel 
ever  has  existed.  We  experience  no  difficulty  in  the  manufacture 
of  open-hearth  steel  in  the  Siemens-Martin  furnace,  and  our  steel 
which  is  thus  produced  is  rapidly  coming  into  general  use  side 
by  side  with  crucible  steel.  In  the  manufacture  of  crucible  steel 
our  achievements  are  in  the  highest  degree  creditable.  In  only 
one  respect  can  it  be  said  that  in  its  manufacture  we  fall  behind 
any  other  country  ;  we  have  not  paid  that  attention  to  the  manu- 
facture of  fine  cutlery  steel  which  Great  Britain  has  done.  This 
is,  however,  owing  to  commercial  and  not  to  mechanical  reasons. 
American  crucible  steel  is  now  used,  without  prejudice,  in  the 
manufacture  of  all  kinds  of  tools,  and  in  the  manufacture  of  car- 
riage-springs and  many  other  articles  for  which  the  best  kinds  of 
steel  are  required.  In  the  quantity  of  open-hearth  and  crucible 
steel,  produced  in  a  given  time  by  a  given  plant,  we  are  certainly 
abreast  of  all  rivals.  The  largest  crucible  steel-works  in  the 
world  are  those  of  Park,  Brother  &  Co.,  at  Pittsburg,  Penn. 
Our  rolling-mill  practice  is  fully  equal  to  the  best  in  Europe, 
except  in  the  rolling  of  heavy  armor  plates,  for  which  there  has 
been  but  little  demand,  and  in  the  production  of  which  we  have, 
consequently,  had  but  little  experience.  The  quality  of  our 
rolled  iron,  including  bar-iron,  plate-iron,  sheet-iron,  iron  hoops, 
and  iron  rails,  is  uniformly  superior  to  that  of  foreign  rolled  iron. 
In  the  production  of  heavy  forgings  and  castings,  as  well  as  all 


35O  SELECTIONS. 

lighter  products  of  the  foundry  and  machine-shop,  this  country 
has  shown  all  the  skill  of  the  most  advanced  iron-working 
countries  in  Europe.  In  the  production  of  steel  castings  we  have 
exhibited  creditable  skill  and  enterprise,  and  we  are  in  advance  of 
all  countries  in  the  regular  use  of  the  Bessemer  converter  for  this 
purpose. 

All  of  our  leading  iron  and  steel  works,  and,  indeed,  very  many 
small  works,  are  now  supplied  with  systematic  chemical  investi- 
gations by  their  own  chemists,  who  are  often  men  of  eminence  in 
their  profession.  The  managers  of  our  blast-furnaces,  rolling- 
mills,  and  steel-works  are  themselves  frequently  well-educated 
chemists,  metallurgists,  geologists,  or  mechanical  engineers,  and, 
sometimes,  all  of  these  combined.  Our  rapid  progress  in  increas- 
ing our  production  of  iron  and  steel  is  not  merely  the  result  of 
good  fortune  or  the  possession  of  unlimited  natural  resources,  but 
is  largely  due  to  the  possession  of  accurate  technical  knowledge 
by  our  iron-masters,  and  by  those  who  are  in  charge  of  their 
works,  combined  with  the  characteristic  American  dash  which  all 
the  world  has  learned  to  respect  and  admire.  The  "  rule  of 
thumb "  no  longer  governs  the  operations  of  the  iron  and  steel 
works  of  this  country. 

A  feature  of  our  iron  and  steel  industries  which  has  attended 
their  marvellous  productiveness  in  late  years  is  the  aggregation 
of  a  number  of  large  producing  establishments  in  districts,  or 
"  centres,"  in  lieu  of  the  earlier  pi-actice  of  erecting  small  furnaces 
and  forges  wherever  sufficient  water-power,  iron-ore,  and  char- 
coal could  be  obtained.  This  tendency  to  concentration  is,  it  is 
true,  not  confined  to  our  iron  and  steel  industries,  but  it  is  to-day 
one  of  the  most  powerful  elements  that  influence  their  develop- 
ment. It  had  its  beginning  with  the  commencement  of  our  dis- 
tinctive rolling-mill  era,  about  1830.  In  colonial  days  and  long 
after  the  Revolution  our  iron-making  and  steel-making  establish- 
ments belonged  to  the  class  of  manufacturing  enterprises  described 
by  Zachariah  Allen,  in  his  "  Science  of  Mechanics,"  in  1829. 
"  The  manufacturing  operations  in  the  United  States  are  all 
carried  on  in  little  hamlets,  which  often  appear  to  spring  up  in 
the  bosom  of  some  forest,  gathered  around  the  waterfall  that 
serves  to  turn  the  mill-wheel.  These  villages  are  scattered  over 
a  vast  extent  of  country,  from  Indiana  to  the  Atlantic,  and  from 
Maine  to  North  Carolina,  instead  of  being  collected  together,  as 
they  are  in  England,  in  great  manufacturing  districts."  While 


U.    S.    IRON   AND   STEEL  INDUSTRIES.  351 

these  primitive  and  picturesque,  but  unproductive,  methods  could 
not  forever  continue,  it  is  greatly  to  be  regretted  that  our  manu- 
factures of  iron  and  steel  and  other  staple  products  could  not  have 
grown  to  their  present  useful  and  necessary  proportions  unat- 
tended by  the  evils  which  usually  accompany  the  collection  of 
large  manufacturing  populations  in  small  areas. 

Upon  the  future  prospects  of  iron  and  steel  industries  it  is  un- 
necessary for  us  to  dwell.  Our  resources  for  the  increased 
production  of  iron  and  steel  for  an  indefinite  period  are  ample, 
and  all  other  essential  conditions  of  continued  growth  are  within 
our  grasp.  We  are,  to-day,  the  second  iron-making  and  steel- 
making  country  in  the  world.  In  a  little  while  we  shall  surpass 
even  Great  Britain  in  the  production  of  steel  of  all  kinds,  as  we 
have  already  surpassed  her  in  the  production  of  Bessemer  steel 
and  in  the  consumption  of  all  iron  and  steel  products.  The  year 
1882  will  probably  witness  this  consummation.  We  are  destined, 
also,  to  pass  Great  Britain  in  the  production  of  pig-iron.  These 
conditions  and  results  are  certainly  gratifying  to  our  national 
pride,  for,  of  themselves,  they  assure  the  ultimate  preeminence  of 
the  United  States  among  all  civilized  countries.  If  it  is  true,  as  re- 
corded in  the  second  chapter  of  Daniel,  that  "  iron  breaketh  in 
pieces  and  subdueth  all  things,"  the  country  which  produces  and 
consumes  the  most  iron  and  steel  must  hold  the  first  rank. 
When  the  United  States  takes  the  position  which  it  is  destined 
soon  to  take,  as  the  leading  iron  and  steel  producing  as  well 
as  consuming  country,  the  saying  of  Bishop  Berkeley,  that 
"  Westward  the  course  of  empire  takes  its  way,"  will  receive  a 
new  interpretation,  for  the  iron  industry,  which  had  its  beginning 
in  Asia,  and  then  passed  successively  to  the  countries  along  the 
Mediterranean,  upon  the  Rhine,  and  in  the  north  of  Europe,  will 
then  have  made  the  circuit  of  the  world. 


352  SELECTIONS. 


XV. 

LES    DETTES    PUBLIQUES. 

FROM  NEYMARCK'S  LES  DETTES  PuBLiquEs  EUROPEENNES,  PP.  86-102. 
/.—  AUGMENTATION  DES  DETTES  PUBLIQUES  DEPUIS  1870. 

DANS  cette  longue  enumeration  de  chiffres,  ce  qui  frappe  tout 
d'abord  1'esprit,  c'est,  1'augmentation  considerable  de  la  dette  pu- 
blique  des  Etats  Europeens  depuis  1870.  Cette  dette  s'^levait  a  75 
milliards  en  1870  environ;  elle  atteint  115  milliards  en  1886. 
L'augmentation  n'est  pas  moindre  de  40  milliards.1 

Nous  avons  pris  a  dessein  cette  date  de  1870  qui  nous  rappelle 
les  plus  grands  malheurs  qtie  notre  pays  ait  jamais  supportes,  les 
lourdes  charges  qui  ont  et£  la  consequence  de  la  guerre,  le  far- 
deau  qui  pese  sur  nous  tous.  La  guerre  de  1870  a  coute  a  la 
France  plus  de  10  milliards  :  sans  elle  nous  ne  serions  pas  greves 
d'impots  ecrasants  et  aucun  peuple  ne  supporterait  plus  facile- 
ment  que  nous  le  poids  de  sa  dette  pubhque. 

Aucun  pays  n'a,  en  effet,  subi  des  desastres  aussi  grands  que 
les  notres ;  aucun  n'a  eu  une  indemnity  de  5  milliards  a  payer  a 
1'etranger ;  aucun  n'a  du.  reconstituer  sa  puissance  militaire,  son 
materiel  de  guerre  ;  aucun  n'a  eu  a  refaire,  pour  ainsi  dire,  la 
patrie  elle-meme  tout  entiere.  Et  cependant  que  voyons-nous? 

»D'apres  le  journal  de  la  Soctete  de  statistique  (avril  1867),  la  dette  publique  d'Eurcpe 
s'elevait,  en  1865-1866,  aux  chiffres  suivants  :  — 

Depenses  totales  des  budgets 10  milliards  508  millions. 

Capitalisation  des  dettes 66         •'         013         " 

Intergt  et  amortissement a          "          438         " 

La  population  de  1'Europe  etait  evalu<*  Ji  291,738,379  habitants ;  la  dette  par  habitant  repre- 
sentait  226  fr.  30. 

M.  Paul  Boiteau,  dims  son  article  sur  le  budget  general  de  1'Etat,  insert  dans  le  Diction- 
naire  des  finances  de  M.  L6on  Say,  a  riuni  sous  le  litre  de  :  "  Budgets  Europeans  "  la  plu- 
partdes  budgets  du  continent,  et  pour  en  faciliter  1'dtude,  il  a  plac£  en  regard  du  montant 
des  depenses  preVues  pour  1'exercice  1885,  le  montant  des  dettes  consolidees  et  autres  qui 
grevent  1'actif  des  differents  Etats  ainsi  que  le  montant  des  de'penses  militaires  et  celles  du 
service  de  la  Dette  et  de  1'amortisseinent.  II  obtient  les  chiffres  suivants  :  — 

Previsions  totales  des  dei>enses  hudgetaires  annuelles        .         .       18  milliards  848  millions. 
Capitalisation  des  dettes  consolidets,  des  dettes  amortissables 

annuites  diverses,  etc 108          "  431          " 

Ddpenses  du  service  des  dettes  et  de  Pamortissement        .        .        4  864 

Depenses  militaires,  guerre  et  marine 4          "  439         " 

On  pourra  comparer  ces  chiffres  a  ceux  que  nous  donnons  plus  loin. 


LES   DETTES   PUBLIQUES. 


353 


A  1'exception  de  1'Angleterre  qui,  par  suite  de  divers  rembourse- 
ments  d'annuites,  a  pu  diminuer  sa  dette  de  1.350  millions;  a 
1'exception  du  Danemark  qui,  par  suite  de  conversions  heureuse- 
ment  effectives,  a  pu  reduire  sa  dette  de  20  millions,  tous  les 
pays  se  sont  endettes  depuis  1870  dans  des  proportions  enormes. 
Void  sur  ce  point  quelques  chiffres  precis.  Nous  rangeons  les 
Etats  par  ordre  d'accroissement  de  leurs  dettes  depuis  1870. 

AUGMENTATION    DU    CAPITAL     NOMINAL     DE     PLUSIEURS     DETTES 
PUBLiqUES    DEPUIS    1870. 


217  millions. 
132 
249 
770 
300 
89 
701 
526 
388 
270 
244 
194 
181 
24 
20 

Cette  augmentation  du  capital  nominal  des  dettes  publiques 
europ^ennes  qui  atteint,  depuis  1870,  40  milliards  environ,  a  eu 
pour  consequence  1'augmentation  des  interets  et  des  amortisse- 
ments  annuels  pour  les  emprunts  contracted  1'accroissement  des 
depenses  totales  des  budgets,  une  surcharge  dans  les  impots. 
Combien  ne  serions-nous  pas  alle'ge's  si  nous  n'avions  pas  a  payer 
chaque  anne'e  les  lourds  impots  qui  grevent  notre  commerce  et 
notre  Industrie,  et  qui,  s'ajoutant  aux  frais  de  production,  ont 
rendu  la  concurrence  a  nos  produits  d'autant  plus  facile?  Toutes 
proportions  gardens,  les  pays  d'Europe  souffrent,  comme  nous, 
de  ces  lourdes  charges  qui,  dans  tous  les  pays,  oberent  les  contri- 
buables.  C'est  la  guerre,  toujours  la  guerre,  qui  redoit  aux 
budgets.  Depuis  seize  ans,  les  budgets  de  la  guerre  et  de  la 
marine  ont  cout£  a  la  France  plus  de  n  milliards,  c'est-a-dire 
plus  de  700  millions  par  an  ;  1'Allemagne  et  la  Russie  n'ont  pas 


Russie  J  . 

ara 

Prusse    . 
Italic       .  .       . 

•         •         -           3 

Hongrie 
Autriche 
Espagne 
Belgique 

•            .             .               2 
»                                          I 

*            •             '                I 

Saxe 

Grece      . 
Serbia     . 



. 

Suede     . 

Hambourg 



• 

'Augmentation  depuis  1866. 


354  SELECTIONS. 

depense  rnoins  de  10  milliards  chacun  pendant  la  meme  p^riode, 
1'Autriche  et  1'Italie  presque  le  meme  chiffre.  Voila  done  cinq 
grands  pays  qui,  en  vue  d'une  guerre  probable,  d^pensent  tons 
les  ans,  de  500  a  900  millions,  depuis  seize  ans.  Que  coiiterait 
done  la  guerre  elle-meme  ? 

Les  Etats  europeens  paient  annuellement  pour  leurs  defenses 
de  la  guerre  et  de  la  marine  a  peu  pres  les  memes  sommes  que 
pour  1'interet  et  ramortissement  de  leurs  dettes.  D'apres  les 
derniers  budgets,  ainsi  que  le  prouvent  les  chiffres  que  nous 
publions  plus  loin,  la  guerre  et  la  marine  coutent  a  1'Europe 
4  milliards  528  millions,  alors  que  1'interet  et  l'amortissement  des 
dettes  publiques  reclament  5  milliards  343  millions.  En  voici  le 
relev£  : 

//.  —  DEFENSES  DE  LA  GUERRE,  DE  LA  MARINE,  CAPITAL  NOMINAL 
ET  INTERETS  DES  DETTES. 

Defenses 
InterSts  ann. 

Exercices  Capital  nominal       et  amort.      Guerre  et 

Etats.  financiers.  de  la  dette.  ann.  marine. 

Milliards-Millions.   Millions.      Millions. 


icr  avril  iSS6. 

4.814 

220 

31  de'c.  1886. 

526 

2O.  I 

539-  « 

31  de'c.  1884. 

9.288 

389-9 

• 

Hongrie    

"     "      " 

3.I7S 

206.8 

342 

Wurtemberg    

31  dec.  1885. 

525 

21-5 

Saxe    

"     "      " 

Soo 

33-z 

31  de'c.  1883. 

178 

8.7 

Baviere  

icr  avril  1886. 

1.790 

61.1 

Bade    

31  dec.  1885. 

53 

2.1 

I] 

Italic   

"      "      •' 

11.131 

532 

342-5 

Suede  

it      ii      ii 

345 

I6.4 

35-5 

3ojuin  1885. 

IS' 

6 

18.3 

31  de'c.  1885. 

274 

12.4 

23 

'  

2.260 

69.5 

69-5 

•i      ii      ii 

1.771 

86.5 

45-6 

Espagne    

ierjuilleti886. 

6.042 

274.1 

200.3 



2.821 

89-3 

39-3 

Angleterre1  

31  mars  1885. 

17.829 

737-5 

740.2 

Serbie     

244 

'3-7 

17.1 
16.2 

er  avril  1887. 

729 

59-2 

28.5 

Grece  

er  Janvier  1886. 

348 

33 

23 

880-1881. 

2.623 

SS-4 

200 

Bulgarie    

er  Janvier  1885. 

2.1 

Finlande    

31  de'c.  1885. 

65 

5-9 

6.1 

ii      ii      ii 

18.028 

1.038 

982.4 

31  die.  1886. 

31.000 

"•336 

859-5 

Totaux  .... 

117.112 

5-343-2 

4-52S-I 

1  D'apres  une  note  de  1'honorable  M.  Hangcosck,  de  la  Socie'td  de  statistique  de  Londres, 
de  fin  mars  1884  a  fin  mars  1885,  1'Angleterre  paie  comme  inte're't  22.000.000  £  et  7.000.000  £ 
comine  amortissement,  soit  au  total  29.500.000  £. 


LES   DETTES   PUBLIQUES.  355 

Dans  quelles  proportions  enormes  les  dettes  publiques  de  toute 
1'Europe  ne  pourraient-elles  pas  etre  reduites  si  les  depenses  de  la 
guerre  n'absorbaient  pas  tons  les  ans  plus  de  85  %  de  ces  memes 
dettes?  Toutes  les  puissances  europ^ennes  ont  des  embarras 
financiers;  toutes  ou  presque  toutes  augmentent  ou  ont  besoin 
d'augmenter  leurs  impots.  Toutes,  sans  exception,  font  des 
armements  considerables.  Cette  situation  presente  les  plus 
graves  dangers  et  plus  que  jamais  cependant,  le  maintien  de  la 
paix  est  n^cessaire  a  1'Europe  pour  consolider  son  credit,  ame- 
liorer  1'etat  de  ses  finances,  donner  de  1'essor  et  de  la  confiance  au 
commerce  et  a  1'industrie. 

///.  —  LES    CONVERSIONS     DE     RENTES    A    L'ETRANGER     ET   Elf 
FRANCE. 

Et  cependant,  malgr£  les  charges  de  toute  nature  qui  pesent 
sur  les  Etats,  les  rentes  de  ces  memes  pays  se  sont  n£gociees 
pendant  1'annee  1886  presque  toutes  aux  plus  hauts  cours  qu'elles 
aient  cotes  depuis  1870.  NOJI  seulement,  grace  a  1'abondance  des 
capitaux  et  a  1'abaissement  du  taux  de  1'int^ret,  les  fonds  publics 
ont  hausse1,  mais  il  a  etc"  realise,  en  matiere  de  finances,  des  pro- 
gres  considerables. 

Les  Etats,  non  plus  que  les  villes  et  les  socie:te's  industrielles  ou 
financieres,  n'h^sitent  pas  a  effectuer,  sur  une  tres  large  e'chelle, 
des  operations  qu'on  cut  a  peine  os£  concevoir  il  y  a  moins  de 
trente  ans. 

Aujourd'hui  des  Etats,  dont  la  puissance  financiere  a  toujours 
etc  relativement  restreinte,  peuvent  contracter  des  emprunts  qui 
depassent  de  beaucoup  ceux  que  naguere  encore  des  nations 
riches  n'eussent  tenths  qu'avec  apprehension. 

Toutes  les  combinaisons  auxquelles  peuvent  preter  les  finances 
d'Etat  qui  etaient  si  longtemps  restees  dans  le  domaine  de  la 
the"orie,  sont  pleinement  entrees  dans  la  pratique  et  se  r£alisent 
couramment.  Bien  des  prejuges  economiques  et  financiers  se 
sont  dissipes  ;  bien  des  pdncipes,  encore  contestes  naguere,  ont 
triomphe  et  se  sont  imposes. 

Le  credit  a  acquis  une  force  d'expansion  inoufe ;  les  fonds 
publics,  les  valeurs  mobilieres  se  sont  de  plus  en  plus  repandues, 
vulgarisees,  democratrsees  en  quelque  sorte.  Leur  grande  facilite 
de  circulation,  leur  mobiJite,  leur  diffusion,  leur  acceasibiJite  a 
toutes  les  fortunes,  petites  ou  grander,  leur  ont  a«sure  «tie  favour, 
que  J'on  peut  trouver  excessive,  mats  qui  est,  a  divers  points  de 


356  SELECTIONS. 

vue,  tres  justified.  Get  essor  de  la  fortune  mobiliere  a  determine 
une  veritable  revolution  dans  les  conditions  financieres  de  1'exis- 
tence  des  peuples. 

Emprunts,  unifications  de  dettes,  conversions,  sont  des  ope>a- 
tions  devenues  familieres  meme  aux  moindres  Etats.  Et,  chose 
assez  Strange,  c'est  la  France  qui,  apres  avoir  ete,  avec  1'Angle- 
terre,  1'initiatrice  des  grandes  reTormes  financieres,  a  ete  depuis 
quelques  ann^es,  parmi  les  nations,  la  plus  timide  a  realiser  les 
combinaisons  heureuses,  legitimes,  profitables,  que  la  puissance 
et  la  solidity  de  son  credit  lui  rendent  si  faciles. 

Rien,  en  effet,  de  plus  curieux  a  observer,  autour  de  nous,  que 
les  nombreuses  operations  de  conversion  deja  accomplies  avec 
succes  ou  en  voie  de  preparation.  Si  on  peut  reprocher  a  certains 
Etats  une  propension  trop  grande  a  emprunter,  il  faut  bien  recon- 
naitre  qu'ils  se  preoccupent  aussi,  pour  la  plupart,  de  n'emprunter 
qu'au  plus  bas  prix  possible.  Des  que  leur  credit  s'etend  et  s'ame- 
liore,  ils  s'efForcent  de  remplacer  les  anciennes  dettes  couteuses, 
onereuses,  par  des  dettes  plus  legeres,  contractees  a  un  taux 
moins  eleve\  Ce  sont  mainlenant  des  puissances  financieres  de 
second  et  de  troisieme  ordre  qui  nos  donnent  1'exemple.  Dans 
cet  ordre  d'idees  et  de  faits,  il  n'est  certainement  pas  inutile  d'ex- 
aminer  comment  se  sont  effectuees  les  conversions  r^centes  et 
d'indiquer  les  divers  precedes,  jusqu'ici  employes. 

Depuis  1870,  deux  fonds  d'Etats  franjais  out  ete  1'objet  d'une 
conversion:  1'emprunt  Morgan  et  la  rente  5%.  On  se  rappelle 
comment  elles  s'effectuerent :  on  ofFrit  aux  porteurs  d'obligations 
Morgan  6%,  le  meme  revenu  en  rente  3%,  moyennant  une  soulte 
de  124  fr.  par  obligation.  Les  porteurs  de  rentes  5%  eurent  a 
opter  entre  le  remboursement  a  100  fr.  de  leurs  rentes  et  1'echange 
contre  un  nouveau  titre  de  rente  ^%  non-convertible  avant  un 
delai  de  10  ans  qui  expire  en  1893. 

La  Belgique  a  ope>e  trois  conversions :  son  4^  est  devenu  du 
\°foi  puis  du  3%.  Pour  la  premiere  operation,  elle  cut  imme- 
diatement  recours  a  un  syndicat  de  banquiers,  qui  se  chargeait  du 
placement  de  la  rente  nouvelle,  tandis  que  1'Etat  operait  le  retrait 
de  la  rente  convertie.  Pour  la  seconde  conversion,  le  gouverne- 
ment  beige  voulet  operer  seul  et  emettre  directement  sa  rente 
nouvelle ;  il  n'obtint  pas  tout  le  succes  d£sir£  et  dut,  apres  des 
essais  peu  favorables,  accepter  le  concours  qui  lui  avait  £te  donne 
precedenament. 

Tout  recemment,  ainsiqu'on  1'avu  dans  le  cours  de  cette  etude, 


LES   DETTES   PUBLIQUES.  357 

la  Belgique  a  realise  une  trosieme  conversion  en  convertissant  ses 
rentes  4%  centre  du  3$%.  Cette  operation,  effective  directe- 
ment  par  le  Tresor,  obtint  un  plein  succes. 

La  Suede  a,  elle  aussi,  transforme  successivement  son  4^  en  4  ffc 
et  en  3^  %  en  recourant  a  1'intermediaire  des  grandes  maisons  de 
banque.  Celles-ci  emettaient  sur  les  marches  Strangers  la  nouvelle 
rente  sue"doise,  tandis  que  1'Etat  restait  charge  du  retrait  des 
anciens  titres. 

On  coii9oit  que  Pintervention  des  syndicats  et  des  groupes  finan- 
ciers soit,  pour  ainsi  dire,  1'unique  moyen  des  petits  Etats  qui 
n'ont  pas  de  marche  national.  II  est  certain  que  la  Roumanie, 
par  exemple,  n'a  pu  effectuer  la  conversion  de  sa  dette  6  %  que 
grace  au  concours  de  puissantes  maisons  auxquelles  elle  s'est 
adressee.  Ce  sont  ces  dernieres  qui  pla9aient  la  nouvelle  rente 
tandis  que  1'Etat  remboursait  1'ancienne. 

L'Espagne,  lors  de  la  recente  conversion  de  ses  emprunts  de 
1'ile  de  Cuba,  s'est  adressee  a  un  groupe  de  banquiers :  elle  s'en- 
tendait  avec  eux  pour  le  prix  de  la  nouvelle  rente  a  creer,  et  avec 
le  produit  du  nouvel  emprunt,  remboursait  des  dettes  anciennes 
contractees  a  plus  gros  interet. 

Les  grands  Etats  qui  ont,  presque  tous,  d'importants  marches 
financiers  ne  se  croient  cependant  pas  toujours  assez  siirs  de  leurs 
propres  forces  pour  dedaigner  le  concours  des  banques  et  des 
institutions  de  credit.  Sans  ces  hautes  influences,  aucune  ope"ra- 
tion  de  credit  importante  ne  pourrait,  sans  doute,  acquerir  un 
caractere  international  et  obtenir  la  participation  des  marches  ex- 
terieurs.  Aussi  toutes  les  conversions  operees  dans  de  larges  pro- 
portions ne  1'ont-elles  etc  qu'avec  la  participation  des  syndicats. 

La  Hongrie  a  effectue  la  conversion  de  sa  rente  6  %  en  rente 
4%  en  or  et  elle  prepare,  en  ce  moment  meme,  une  operation  du 
meme  genre  sur  d'autres  dettes.  Ici,  les  banquiers,  grouped  en 
vue  de  cette  transformation,  se  sont  charges  a  la  fois  et  du  place- 
ment de  la  rente  nouvelle  et  du  retrait  de  la  rente  ancienne.  Le 
remboursement  au  pair  n'est  devenu  obligatoire  pour  les  porteurs 
de  6  %  hongrois  qu'a  Tissue  de  l'ope>ation  qui  s'est  eftectue'e  par 
fractions  echelonnees.  La  loi,  qui  a  fixe1  les  conditions  dans  les- 
quelles  cette  conversion  fut  autorise"e,  e"tait  con9ue  presque  dans 
les  memes  termes  que  le  projet  que  nous  formulions  nous-meme 
des  le  mois  d'aout  1876 1  en  vue  de  la  conversion  e"ventuelle  du 
5  %  frangais. 

i  Voir  notre  «ude :  La  Conversion  de  la  Rente  5  %.    Paris,  Dentu,  Wit.,  1876. 


358  SELECTIONS. 

En  Allemagne,  les  conversions  de  fonds  prussiens,  bavarois  et 
wurtembergeois  se  sont  op£r£es  par  1'emission  d'emprunts  dont  le 
produit  a  servi  au  remboursement  des  anciennes  rentes. 

A  1'etranger,  il  nous  reste  a  citer,  au-dessus  de  tous,  1'exemple 
des  Etats-Unis  qui  ont  accompli  avec  une  habilete  et  un  esprit  de 
suite  merveilleux  des  conversions  successives  dans  les  conditions 
les  plus  heureuses  et  les  plus  favorables,  sans  que  les  particuliers 
aient  jamais  eu  a  souffrir  des  consequences  de  ces  transformations 
repetees.  Grace  a  la  prevoyance  avec  laquelle  PAmerique  du 
Nord  avait  cr6e"  ses  rentes  par  series,  des  conversions  partielles 
ont  pu  se  succeder  rapidement ;  et  1'on  a  vu  en  pen  d'annees  du 
6  °Jo  se  transformer  en  5  %,  puis  en  4  %,  puis  en  3  %.  Ces 
operations  nombreuses,  les  Etats-Unis  les  ont  effectuees  directe- 
ment  sur  leurs  propres  marches  et  a  1'exterieur  avec  le  concours 
de  grandes  maisons  de  banque. 

Mais,  en  dehors  des  exemples  que  nous  ont  donnas  les  autres 
nations,  nous  pourrions  rappeler  ceux  que,  sous  des  formes 
diverses,  nous  ont  ofFerts  nos  departements  francais  et  nos  pro- 
pres villes.  La,  encore,  nous  trouvons  des  efforts  tres  louables 
et  des  combinaisons  tres  variees.  Nous  avons  vu  des  villes  re- 
courir  au  remboursement  au  pair  d'anciennes  dettes  et  a  des 
emprunts  plus  avantageux  pour  alleger  leurs  charges,  les  unes 
s'adressant  au  public,  les  autres  s'assurant  1'appui  de  syndicats, 
d'autres  enfin  traitant,  sans  autre  intermediate,  avec  le  Credit 
Foncier  de  France  qui  leur  garantissait  a  un  taux  maximum  les 
capitaux  dont  elle  avaient  besoin  pour  rembourser  la  dette  ante- 
rieure  contractee  a  un  taux  plus  e'leve'. 

Nous  avons  vu  enfin,  pluspresde  nous  encore,  le  Credit  Foncier 
de  France  profiler,  pour  son  propre  compte,  et  au  grand  profit  de 
sa  vaste  clientele  d'emprunteurs,  de  1'abaissement  du  prix  de 
1'argent,  et  convertir  des  obligations  entrainant  une  annuite 
elevee  par  des  titres  n'exigeant  qu'une  annuite  notablement  infe- 
rieure.  On  sait  avec  quelle  simplicity  s'est  effectuee  cette  op^ra- 
tion  :  les  porteurs  des  obligations  a  convertir  avaient  un  droit  de 
preference  dans  la  souscription  des  obligation*  nouvelles ;  ils 
restaient  libres  de  n'en  pas  user,  mais  etaient  dument  avertis  du 
remboursement  prochain  et  obligatoire  des  titres  anciens. 

Ainsi  les  nations  qui  nous  entourent  et,  chez  nous-memes,  les 
provinces,  les  villes,  les  institutions  de  credit,  ont  pratique  avec 
empressement  et  avec  succes.  sous  les  formes  les  plus  diverses, 
des  conversions  qui,  toutes,  ont  ete  profitables.  En  ce  moment 


LES   DETTES   PUBLIQUES.  359 

meme,  de  grandes  operations  de  ce  genre  sont  a  prevoir.  II  n'es- 
pas  douteux,  en  effet,  que  PAngleterre  ne  se  prepare  a  une  nout 
velle  conversion  de  ses  Consolid^s  dont  les  cours  sont  au-dessus  du 
pair ;  des  que  1'occasion  sera  propice,  la  transformation  sera  faite. 
En  Italic,  la  conversion  de  la  rente  5%  est  a  1'ordre  du  jour,  et  il 
ne  s'^coulera  pas  beaucoup  de  temps  avant  qu'elle  ne  soit  realised. 
Deja  le  gouvernement  a  prepare  un  projet  pour  convertir  plu- 
sieurs  dettes  rachetables  et  offre  du  4^  a  la  place  du  5%. 

II  est  a  remarquer  que  toutes  ces  conversions  de  rentes,  qui 
ont  diminu£  1'interet  paye  par  les  Etats  a  leurs  preteurs,  n'ont  nul- 
lement  diminue  les  charges  de  ces  divers  pays.  Pour  etre  juste, 
equitable,  toute  conversion  de  rentes  doit  avoir  pour  consequence 
une  diminution  d'impots.  II  n'en  a  rien  6te.  Prenez  tous  les 
budgets  des  pays  qui  ont  effectue  des  conversions ;  comparez  les 
chiffres  des  depenses  publiques  et  des  impots  a  ceux  qui  e"taient 
inscrits  avant  et  apres  les  conversions,  vous  trouverez  partout  des 
augmentations  de  depenses  et  d'impots. 

II  faut  remarquer,  d'autre  part,  que  presque  toutes  ces  conver- 
sions n'ont  pu  etre  realisees  avec  succes  qu'autant  que  la  haute 
banque  est  intervenue  et  leur  a  donn£  son  concours.  II  convient 
enfin  de  dire  que  toutes  ces  operations  ont  etc  facilities  par 
1'abondance  toujours  croissante  des  capitaux  disponibles,  et  par  la 
baisse  du  taux  de  1'interet,  consequence  de  cette  abondance  des 
capitaux. 

IV.—  ABAISSEMENT  DU  TAUX  DE  DINTERETDE  U ARGENT  DEPUIS 

1870. 

Depuis  1870,  et  surtout  depuis  le  jour  ou,  pour  la  premiere  fois 
depuis  la  guerre,  la  rente  5%  fut  cot6  au  pair,  c'est-a-dire  a  100, 
le  4  septembre  1874,  des  changements  profonds  se  sont  produits 
sur  les  marches  frangais  et  etrangers  dans  le  taux  de  capitalisa- 
tion. Successivement,  d'annee  en  ann£e,  lentement  d'abord,  puis 
par  etapes  vigoureusement  franchies,  les  valeursde  premier ordre, 
de  premiere  surete,  descendirent  de  5%  d'interet  a  4^%  ;  les 
valeurs  de  second  ordre,  qui  rapportaient  6£,  7  et  8%,  descendirent 
a  $%  et  meme  au-dessous.  A  mesure  que  le  capital  de  ces  valeurs 
augmentait,  leur  revenu  devenait  naturellement  moins  eiev^. 

Au  lendemain  de  la  guerre,  un  capital  de  100,000  place  en 
rentes  5%  aurait  produit  5.500  a  6.000  fr.  de  rentes.  Le  meme 
capital,  place  aujourd'hui  en  rentes  frangaises  3%  produirait  a 
peine  3.700  francs. 

Depuis  1870,  le  6%  Americain  a  disparu ;  converti  d'abord  en 


360  SELECTIONS. 

5%,  puis  en  4%>  ^e  voila  maintenant  en  3%  en  attendant  une 
nouvelle  conversion  en  z£. 

Le  4^  Beige,  les  fonds  Allemands,  tels  que  les  5%  Badois, 
Bavarois,  Wurtembergeois,  etc.,  ont,  sur  la  cote,  c6d6  la  place  a 
des  titres  de  moindre  rapport,  a  des  rentes  de  3^  et  de  3%,  qui 
atteignent  le  pair. 

Dans  1'Europe  entiere,  les  rentes  4%  qui  ont  £te  cr6ees  en 
remplacement  de  rentes  5%  sont  au  pair  et  meme  au-dessus,  ou 
ont  6t6  ^cliange'es  centre  du  T3^  ou  du  3%. 

Des  fonds  Strangers,  exotiques,  comme  Ton  dit  en  Bourse, 
arrivent  maintenant  au  taux  moyen  auquel  se  n^gociaient  ancien- 
nement  de  bons  credits  europ^ens  de  second  ordre.  Les  cotes 
anglaises  nous  donnent  a  cet  £gard,  de  curieux  exemples. 

II  y  a  dix  ans  seulement,  voici,  notatnment,  le  7%  Japonais 
qui  valait  100  fr.  fin  1876  et  qui  maintenant  vaut  113  ;  a  pareille 
date,  le  6%  Argentin  1868,  cote  aujourd'hui  101  a  102,  valait  60 ; 
le  5%  Bre"silien  valait  fin  1876,  87  a  88  ;  il  est  maintenant  a  103, 
trois  points  au-dessus  du  pair. 

Le  5%  Italien  qui  ne  donne  net  que  434^  valait,  fin  1876,  72 
fr. :  il  6tait  dans  ces  derniers  temps  a  102  fr.  et  meme  au-dessus, 
c'est-a-dire  20  fr.  plus  cher  que  le  prix  auquel  nous  emettions  en 
1871  notre  rente  fran9aise  5%. 

Le  5%  Roumain,  qui  valait  40  fr.  fin  1876,  et  qui  rapportait 
conse"quemment  8%,  se  negocie  au-dessus  de  90.  On  lvalue 
done  aujourd'hui  le  credit  de  la  Roumanie  a  un  taux  bien  supe- 
rieur  a  celui  auquel  notre  propre  credit  6tait  estime'  en  1871  et 
1872,  puisque,  dans  ces  deux  ann^es,  la  France  6mettait  ses 
rentes  5%  a  82,50  et  84  fr.  50. 

La  rente  Autrichienne  4%  or,  cotee  89  a  90  fr.  et  qui,  il  y  a 
peu  de  temps,  s'est  ne"goci£e  meme  a  96  et  97  fr.,  est  encore  plus 
haut  que  nos  rentes  franfaises  en  1871.  La  rente  Hongroise  4% 
or,  a  valu  jusqu'a  88  dans  ces  derniers  mois,  alors  que  nous  avons 
emis  du  5%  frangais  5  et  6  francs  plus  bas. 

Voici,  pour  les  principaux  fonds  d'Etats,  la  difference  des  cours 
cotes  au  31  decembre  1869  et  au  31  decembre  1886. 

31  d£c.  1869  31  d<5c.  1886 

3%  Fran9ais 7°i°5  82,20 

4,34  Italien 57>3°  Ioi^5 

6%  Americain 84  134          (\e 

4^  Beige 102^  95,40     (le 

5%  Russe  1862      ....               85  96 

3%  Consolid^s  anglais    .     .  92^  ioi£ 


LES   DETTES   PUBLIQUES.  361 


V.  —  MODES  DEMISSION  ET    T\PES  DE    RENTES  EMPLOYES  PAR 
LES  GOUVERNEMENTS   EMPRUNTEURS. 

Nous  venons  de  montrer  comment  les  conversions  de  rentes 
effectuees  par  les  principaux  Etats  avaient  £t6  r£alis£es  et  com- 
ment la  baisse  du  taux  de  Finte'ret  et  1'abondance  des  capitaux 
avaient  facility  ces  operations.  II  n'est  pas  sans  utilite  de  faire 
remarquer  aussi  comment  les  divers  pays  effectuent  leurs  em- 
prunts.  On  voit,  d'apres  cette  etude  comparative  des  dettes  euro- 
peennes,  combien  est  varied  la  diversity  des  types  de  rentes 
emises.  L'Angleterre  a  du  3%,  du  2^%,  des  anuites  terminables  ; 
FAutriche,  du  4,20%  m£tallique,  du  4%  or,  du  5%  papier,  du 
5%  argent,  des  lots  a  primes  sans  int^rets.  La  Belgique  a  eu  du 
4^,  du  4%,  du  3%.  La  Russie  a  emis  des  emprunts  sous  forme 
de  rentes  6%,  5%,  4%  ;  la  Hollande  a  des  rentes  3$,  3%,  2\%  \ 
1'Italie  a  du  5%,  du  3%  et  vient  de  decreter  du  4%%  »  la  Norwege 
a  du  4|,  du4%,  du  3^;  le  Portugal  a  du  5%  et  du  3%;  la 
Prusse  a  du  4%  et  du  3^%,  la  Roumanie  a  7%,  du  6%,  du  5%  ; 
la  Saxe,  du  3^  et  du  3%  ;  la  Suede,  du  4$%,  du  4%,  du  &%  5  le 
Wurtemberg,  du  4$,  du  4%,  du&%,  etc.  Parmi  les  fonds  colo- 
niaux,  nous  trouvons  du  5%  de  la  Nouvelle  Zllande,  du  5%  Que- 
bec, du  6%  Queensland,  4$,  4%  et  $\%  des  Indes,  du  4%  du 
Canada,  de  la  Jamaique,  de  Tasmanie  du5%,  4$%,  4%  Victoria. 
Quel  enseignement  tirer  de  ces  faits  ?  C'est  qu'on  ne  peut  dire  d'une 
fa?on  absolue,  c'est  qu'il  n'est  pas  scientifiquement  ni  pratique- 
ment  prouv6  qu'il  soit  preferable  pour  un  Etat  de  n'emprunter 
que  sous  un  meme  type  de  rentes,  et  que  la  diversite  de  ces 
types  de  rentes  peut  nuire  a  leur  plus-value.  La  verite  est  qu'il 
en  est  des  Etats  comme  des  particuliers :  le  meilleur  mode  d'em- 
prunt  est  celui  qui  coute  le  moins  cher  et  procure  la  plus  grand  e 
somme  des  capitaux.  II  peut  etre  utile  d'emprunter  sous  forme 
d'obligations  ou  sous  forme  de  rentes  ;  en  4%  ou  en  3%  ;  en  5% 
ou  en  4|%.  C'est  une  question  d'opportunite  et  d'appreciation. 
Tous  les  gouvernements  ont  choisi  la  forme  d'emprunt  la  plus 
avantageuse  aux  interets  de  tous,  sans  s'astreindre  a  n'emettre 
qu'un  type  de  rentes  d£termin£  a  1'avance. 

II  en  est  de  meme  pour  le  mode  d'emission  des  emprunts. 
C'est  la  France  qui,  lors  de  la  guerre  de  Crimee,  generalisa  le 
systeme  des  souscriptions  publiques.  Avant  1852,  les  emprunts 
d'Etat  etaient  soumissionnes  par  de  grandes  maisons  de  banque 
qui  pla?aient  ensuite  les  titres  de  rentes  dans  leur  clientele  :  plus 


362  SELECTIONS. 

tard,  les  gouvernements  firent  appel  directement  aux  capitaux 
du  public  sans  se  servir  de  I'intermEdiaire  des  banquiers.  Cepen- 
dant,  des  modifications  s^rieuses  se  sont  produites  dans  le  sys- 
teme  des  souscriptions.  Nous  voyons  1'Angleterre  pour  ses 
emprunts  coloniaux,  pour  ses  emprunts  de  villes,  effectuer  des 
appels  au  credit  sous  forme  d'adjudication  publique.  Elle  oftre 
4%  d'intEret,  par  exemple  ;  elle  s'engage  a  servir  d'abord  les 
demandes  de  ceux  qui  se  contentent  d'un  interet  moindre.  Ce 
systeme  favorise  les  souscripteurs  les  moins  exigeants,  ne  d6- 
courage  pas  le  public  par  des  mecomptes  immerites  a  la  repar- 
tition et  permet  a  1'emprunteur  d'obtenir  les  conditions  les  plus 
favorables  ;  ce  genre  de  souscription  rend  les  emprunts  moins 
onereux  pour  les  emprunteurs.  Les  autres  modes  d'emprunts 
employe's  par  les  gouvernements  sont  des  ventes  fermes  ou  a 
option  a  des  banquiers  et  a  des  etablissements  de  credit.  Plusieurs 
Etats  se  sont  bornes  a  charger  des  maisons  de  banque  d'emettre 
les  emprunts  qu'ils  dEsiraient  effectuer,  moyennant  une  com- 
mission. A  1'exception  de  1'Angleterre  et  de  la  France,  presque 
tous  les  gouvernements  europeens  traitent  encore  avec  des  syn- 
dicats  de  banquiers  pour  leurs  emissions. 

VI.  — DE  LA  REPARTITION'  DES  FONDS  PULICS  ETRANGERS  DANS 
LES  PORTEFEUILLES  FRAfffAIS. 

Dans  le  cours  de  cette  etude,  nous  avons  essaye  de  connaitre 
le  montant  approximatif  des  valeurs  e"trangeres  appartenant  a  nos 
nationaux.  Les  chiffres  que  que  nous  avons  citEs  nous  ont  etc 
donnas  par  les  ministres  des  finances  et  les  directeurs  de  statis- 
tique  des  gouvernements  Strangers ;  mais  ils  auraient  besoin 
d'etre  comple^s,  et  aucune  autoritE  ne  pourrait  mieux  que  notre 
conseil  sup^rieur  de  statistique  obtenir  et  grouper  des  indications 
plus  nombreuses  sur  ce  sujet  important. 

A  de  rares  exceptions  pres,  et  sauf  des  circonstances  particu- 
lieres  telles  que  la  hausse  ou  la  baisse  du  prix  du  change  sur 
des  valeurs  internationales,  les  capitalistes  fran9ais  qui  posse- 
dent  des  valeurs  6trangeres  ne  font  pas  recevoir  le  montant  de 
leurs  coupons  d'interet  a  I'^tranger :  ils  s'adressent  a  des  ban- 
quiers et  des  Etablissements  de  credit  fra^ais,  pour  encaisser 
leurs  coupons  e'chus. 

Nous  sommes  convaincus  que  MM.  de  Rothschild,  la  Banque 
de  Paris,  la  SociEt£  G£nErale,  le  Comptoir  d'Escompte,  le  Credit 


LES   DETTES   PUBLIQUES.  363 

Lyonnais,  le  Credit  industrial  et  tous  les  banquiers  —  qui  paient 
une  patente  sp£ciale  comme  effectuant  des  paiements  de  coupons 
etrangers,  —  r£pondraient  sans  difficult^  a  un  questionnaire 
que  le  Conseil  superieur  de  statistique  leur  adresserait. 

Ce  n'est  pas  par  simple  curiosit6  que  des  documents  semblables 
auraient  besoin  d'etre  mis  au  jour.  Les  questions  financieres  et 
fiscales  doivent,  plus  que  jamais,  prendre  le  pas  sur  les  questions 
politiques.  Or,  ce  que  nos  legislateurs  et  la  plupart  de  nos 
hommes  politiques  connaissent  le  moins,  c'est  I'exacte  situation 
de  la  fortune  publique  de  la  France,  le  montant  et  la  puissance 
de  son  epargne,  la  nature  et  le  chiffre  de  ses  placements  soit  sur 
des  valeurs  fran9aises,  soit  sur  des  valeurs  etrangeres.  C'est  a  ce 
defaut  de  connaissances  qu'il  faut  attribuer,  pour  beaucoup,  les 
erreurs  fiscales  economiques  et  financieres  qui  ont  et£  commises 
dans  1'etablissement,  1'augmentation  et  la  suppression  de  tel  ou 
tel  impot  de  preference  a  tel  ou  tel  autre.  A  une  epoque  ou  il  est 
question  d'impot  sur  les  rentes,  d'impot  sur  les  valeurs  etran- 
geres appartenant  a  des  Fran9ais,  d'impot  sur  le  revenu,  etc., 
ces  renseignements  sont  indespensables  si  Ton  veut  eViter  de 
dangereuses  erreurs.  Le  Conseil  superieur  ne  doit  pas  hesiter,  a 
notre  avis,  a  faire  la  lumiere  sur  ces  questions  spe'ciales :  c'est 
du  cote  des  statistiques  financieres,  nous  ne  saurions  trop  in- 
sister  sur  ce  point,  que  doivent  proter  les  efforts  et  les  travaux 
des  hommes  e'minents  qui  font  partie  de  la  Commission. 


.VII. -DE  LA   COTE    ET  DE  LA   NEGOCIATION  DES   RENTES  FRAN- 
fAISES  AUX  BOURSES  ETRANGERES. 

Nous  devons  aussi  signaler  une  reforme  que  nous  avons  bien 
souvent  r^clamee  et  qui  paraitra  sans  doute  utile  a  obtenir 
quand  on  se  sera  rendu  compte  de  1'importance  des  emprunts 
etrangers  contractes  en  France.  A  1'exception  des  fonds  allemands, 
tous  les  fonds  d'Etat  etrangers,  toutes  les  principals  valeurs 
etrangeres  sont  cotes  a  notre  bourse;  tous  les  gouvernements 
etrangers  ont  fait  appel  aux  capitaux  fran9ais.  Or,  aucune  de  nos 
rentes  fran^aises  n'est  cotee  ni  a  Vienne,  ni  a  Saint-Petersbourg, 
ni  a  Stockolm,  ni  a  Christiania,  ni  a  Rome,  ni  a  Florence,  ni  a 
Madrid,  ni  a  Lisbonne,  ni  a  Athenes.  Notre  3%  est  cot^  a  Lon- 
dres,  Bruxelles  et  Amsterdam.  Et  c'est  tout.  Cette  situation  me- 
rite  qu'on  y  porte  attention. 

L'affluence  des  fonds  d'Etat  etrangers  sua  le  march6  fra^ais, 


364  SELECTIONS. 

la  facilit^  avec  laquelle  ils  s'y  placent  et  s'y  negocient,  sont  des 
faits  financiers  qui  revelent  une  tendance  des  capitaux  centre 
laquelle  il  serait  peut-etre  a  las  fois  tres  difficile  de  tenter  une 
reaction  soudaine  et  violente. 

II  est  certainement  regrettable  que  nos  nationaux  deviennent 
les  cre"anciers  d'^tats  dont  la  solvability  et  le  credit  sont  douteux. 
II  est  non  moins  facheux  qu'aux  capitaux  lentement  forme's  par  les 
hommes  d'e"pargne  de  notre  pays  se  substituent  des  titres  etrangers 
de"pourvus  de  garantie  s£rieuse. 

Mais,  d'autre  part,  il  ne  saurait  etre  mauvais  et  il  est  meme 
ne"cessaire  et  utile,  au  point  de  vue  financier  et  e'conomique,  que 
les  nations  honnetes  et  notoirement  solvables  soient  debitrices  de 
la  ndtre.  II  ne  saurait  etre  mauvais  qu'a  un  moment  donne  il  y 
ait  entre  les  mains  des  capitalistes  fran9ais  une  certaine  quantite 
de  bon  papier  etranger,  bien  et  dument  garanti,  et  facilement 
realisable. 

On  confoit  cependant  qu'il  y  a  un  certain  e*quilibre  financier 
international  que  ne  saurait  etre  rompu  san  inconvenient.  On 
con9oit  le  peril  qu'il  y  aurait  pour  la  France  a  ne  compter  au 
dehors  que  des  de"biteurs  et  point  de  cr^anciers,  a  toujours  absorber 
le  papier  et  ne  jamais  en  c^der,  a  se  saturer  de  valeurs  etrangeres 
tandis  qu'elle  ne  placerait  point  dans  les  autres  pays  une  quantite 
a  peu  pres  e"quivalente  de  valeurs  frai^aises.  On  peut  enfin 
mesurer  le  danger  que  notre  pays  pourrait  courir  le  jour  ou  les 
nations  qui  nous  entourent  gagneraient  plus  a  notre  ruine  qu'a 
notre  prosp^rite".  Meme  au  point  de  vu  politique,  ces  considera- 
tions ne  sont  pas  sans  consistance. 

Politiquement,  aussi  bien  que  financierement,  il  est  done  sage 
et  desirable  d'inte"resser  1'Europe  a  nos  progres,  a  notre  develop- 
pement  national,  a  notre  avenir  e'conomique. 

Un  des  moyens  les  plus  efficaces  d'atteindre  ce  but  est  de  placer 
parmi  les  capitalistes  Strangers  la  plus  grande  quantite  possible  de 
rentes  et  de  valeurs  frar^aises. 

Mais,  dira-t-on,  cette  expansion  des  titres  fran9ais  s'ope"rera 
naturellement,  grace  a  la  confiance  si  grande  que  le  credit  de  la 
France  inspire  aux  autres  peuples.  Si  bien  qu'il  n'y  aurait  qu'a 
laisser  faire  au  temps,  aux  capitaux  Strangers  et  a  la  sagesse  des 
nations  pour  assurer  un  re"sultat  si  souhaitable  pour  notre  avenir. 

Ce  raisonnement  est  d'une  logique  excellente  et  peut  paraitre 
tres  solidement  fonde*  en  theorie.  II  est  absolument  vain,  s'il  n'est 
pas  justifie'  par  la  pratique.  Or,  il  ne  Test  malheureusement  pas. 


LES   DETTES    PUBLIQUES.  365 

Ce  n'est  pas  tout  de  dire  aux  autres  nations :  "  Moi,  France, 
j'emets  de  la  rente,  offrant  toutes  garanties,  pleine  s£curit£. 
Prenez-la ;  il  n'y  a  rien  de  meilleur.  Vous  connaissez  ma 
richesse,  ma  puissance  de  production,  mon  amour  du  travail,  ma 
probite  reconnue.  Vous  savez  que  j'ai  toujours  pay£  et  bien  pay£  ; 
vous  savez  combien,  meme  dans  les  circonstances  les  plus  criti- 
ques, j'ai  et£  ponctuelle  a  remplir  mes  engagements.  Prenez  de 
ma  rente  !  Quels  meilleurs  litres  avez-vous  chez  vous  ?  Quels 
meilleurs  placements?  Quel  emploi  plus  productif  et  plus  sur." 

Un  tel  discours  n'aurait  rien  que  de  jusce  et  d'exact.  Tout  le 
monde  est  p6n6tr£  de  ces  v£rit£s  et  nous  n'aurions  a  precher  que 
des  convertis. 

Mais,  pour  que  l'£tranger  prenne  beaucoup  de  nos  fonds  d'Etat, 
encore  faut-il  qu'il  sache  ou  aller  les  prendre,  ou  aller  les  acheter, 
et  m6me  ou  aller  les  vendre,  le  besoin  6cheant.  II  faut  les  rendre 
accessibles  a  tous  les  capitalistes  de  1'Europe,  et  negociables  facile- 
ment  partout. 

Or,  c'est  ce  dont  on  ne  nous  parait  pas  s'etre  suffisamment 
occupe. 

Comme  nous  1'avons  dit  plus  haut,  nos  rentes  fran9aises  ne 
sont  pas  cotees  aux  bourses  etrangeres.  Dans  ces  dernieres 
annees,  de  grands  emprunts  ont  6t6  effectu^s  chez  nous  notam- 
ment  en  rente  3%  amortissable.  On  peut  dire  qu'a  Pheure  ou 
nous  sommes,  cette  rente  est  presque  inconnue  sur  les  grandes 
places  financieres  de  1'Europe.  II  y  a  la  une  faute  commise,  une 
grave  negligence  qu'il  faut  se  hater  de  r£parer.  On  doit  faire 
pour  nos  rentes  ce  que  les  autres  nations  font  pour  leurs  fonds 
d'etat  qu'elles  prennent  tant  de  soin  de  nous  faire  connaitre  et 
auquels  elles  ouvrent  acces  sur  tous  les  grands  marches  europ£ens. 


VII /.—  GUERRE,  RUINE   OU  REVOLUTION  INDUSTRIELLE  ET  ECO- 

NOMIQUE. 

Mais  ce  qui,  a  notre  avis,  ressort  jusqu'a  1'evidence  du  travail 
auquel  nous  nous  sommes  livres,  c'est  que  1'Europe  entiere, 
avec  le  poids  de  ses  depenses  militaires,  avec  la  surcharge  des 
dettes  publiques  et  d'impdts  qui  1'ecrasent,  marche,  si  elle  perse- 
vere dans  cette  vote,  a  la  guerre,  a  la  ruine,  a  une  veritable  revo- 
lution industrielle  et  economique.  Quel  que  soit  le  pessimisme 
d'une  telle  conclusion,  nous  ne  pouvons  taire  nos  impressions. 
La  paix  de  1'Europe  n'est,  a  vrai  dire,  qu'un  etat  de  guerre  latent, 


366  SELECTIONS. 

et  cette  situation  qui  semble  la  condition  ordinaire  du  vieux  conti- 
nent pese  de  deux  manieres  sur  le  monde  civilis6  :  elle  lui  enleve, 
d'une  part,  une  bonne  partie  des  capitaux  constitues  par  1'epargne 
annuelle,  par  le  travail  de  tous,  pour  entretenir  des  soldats, 
acheter  des  fusils,  des  canons,  des  munitions,  construire  des  forte- 
resses,  des  navires ;  d'autre  part,  elle  1'empeche  de  se  servir  de 
ces  capitaux  £normes  pour  deVelopper  le  commerce,  1'industrie, 
le  materiel  de  la  production,  diminuer  les  frais  g^neraux  de  la 
nation.  L' apprehension  et  les  preparatifs  de  guerre  deviennent 
aussi  nuisibles  et  aussi  couteux  que  la  guerre  elle-meme.  Les 
finances  de  1'Europe  sont  tellement  obe"r£es  qu'on  peut  crairidre 
qu'elles  ne  conduisent  fatalement  les  gouvernements  a  se  deman- 
der  si  la  guerre,  avec  ses  eVentualites  terribles,  ne  doit  pas  etre 
preferee  au  maintien  d'une  paix  precaire  et  couteuse.  Si  ce  n'est 
point  a  la  guerre  que  doivent  aboutir  les  preparatifs  militaires  et 
les  armements  de  1'Europe,  ce  pourrait  bien  etre,  ainsi  que  le 
disait,  il  y  a  vingt  ans,  lord  Stanley,  a  "  la  banqueroute  des 
Etats."  Si  ce  n'est  ni  a  la  guerre  ni  a  la  ruine  que  doivent  con- 
duire  de  semblables  folies,  c'est  assurement  a  une  revolution  in- 
duitrielle  et  economique. 

La  vielle  Europe  lutte  centre  la  concurrence  de  pays  jeunes, 
riches  produisant  a  meilleur  compte.  II  est,  au-dela  de  I'Oce'an, 
une  R£publique  puissante,  1'Amerique,  qui  a  su  e"teindre  une 
dette  que  les  n^cessites  d'une  grande  cause  lui  avaient  fait  con- 
tracter ;  elle  offre  au  monde  entier  le  spectacle  d'une  prosperite 
sans  exemple.  Tout  recemment,  le  message  du  president  Cleve- 
land a  1'ouverture  du  Congres  a  traduit  le  sentiment  d'un  veritable 
embarras  de  richesses.  En  Asie,  tous  les  peuples  commencent  a 
profiler  des  decouvertes  et  des  progres  que  1'Europe  a  accomplis, 
et  comme  dans  ces  pays  le  prix  de  la  main-d'oeuvre  et  les  charges 
publiques  sont  presque  nuls,  1'Europe  entiere  £prouvera  chaque 
ann£e,  de  plus  en  plus,  les  affets  de  1'apparition  sur  la  scene 
commerciale  et  industrielle,  de  tous  ces  peuples  qui  n'ont  pas  a 
payer,  tous  les  ans,  ni  quatre  milliards  et  demi  pour  les  depenses 
de  la  guerre,  ni  plus  de  cinq  milliards  pour  les  int^rets  de  leurs 
dettes  publiques. 

Le  marshal  de  Moltke  disait  recemment  au  Reichstag  "  qu'a 
la  longue  les  peuples  ne  pourront  plus  supporter  les  charges 
militaires."  II  aurait  pu  ajouter  que  le  jour  ou  les  peuples  se 
rendront  compte  de  tout  ce  que  leur  coute  la  guerre,  meme 
lorsqu'elle  demeure  a  1'etat  de  simple  risque,  lorsqu'ils  consi- 


LES   DETTES   PUBLIQUES.  367 

dereront  la  masse  croissante  d'int^rets  que  le  progres  jette  chaque 
jour  du  cot6  de  la  paix,  les  gouvern^s  sauront  ce  jour-la  dieter 
leurs  volonte's  a  leurs  gouvernants.  Les  41  milliards  d'augmenta- 
tion  des  dettes  publiques  de  1'Europe,  depuis  1870,  mi»  en  re- 
gard des  milliards  de  diminution  de  la  dette  de  PAme'rique 
offrent  un  puissant  enseignement.  Non,  les  peuples  ne  pourront 
plus  a  la  longue  supporter  dc  tels  fardeaux  ;  non,  ils  ne  pourront 
plus  continuer  a  travailler,  a  peiner,  a  souffrir,  a  clever  penible- 
ment  leurs  families  pour  que  leurs  biens,  leurs  ressources,  leurs 
epargnes,  les  etres  qui  leurs  sont  chers,  soient  sacrifies  et  d^truits 
par  la  guerre  dans  des  luttes  gigantesques.  Ils  veulent  la  paix, 
profiler  des  bienfaits  qu'elle  procure,  echanger  paisiblement  leurs 
produits,  commercer,  travailler ;  ils  veulent  tous  une  administra- 
tion e'conome,  des  diminutions  d'imp6ts. 

A  ces  d£sirs,  les  gouvernements  r^pondent  en  augmentant  tous 
les  ans  les  charges  militaires,  les  preparatifs  de  guerre,  les  charges 
publiques. 

Les  peuples  finiront  par  se  lasser  du  maintien  d'un  tel  £tat  de 
choses  qui  nous  ramene  aux  temps  barbares :  la  civilisation  qui  a 
abattu  les  barrieres  entre  les  pays  et  les  individus,  rendu  les  com- 
munications plus  rapides  et  plus  faciles,  etabli  des  chemins  de  fer 
et  des  routes,  creus£  des  canaux,  perce  des  montagnes  et  des 
isthmes,  imposera  la  paix  aux  socie^s  modernes  d'une  fa9on 
aussi  irresistible  que  la  guerre  s'imposait  aux  sauvages  et  aux 
soci£tes  anciennes. —  Janvier,  1887. 


Tftr-osOPHTCAL     NIVERSITY 
Point  U/uia. 


I II I  III  III  111  I 

A     000019054     6 


